Troy R. Douthit and Mildred P. Douthit v. United States of America, Cecil S. Carroll and Treba Carroll v. United States

Plaintiffs-appellees are partners in an automobile dealership seeking a refund of federal incomes taxes paid by them pursuant to deficiencies assessed by the Internal Revenue Service as a result of an adjustment required by a change in their accounting method, 26 U.S.C. § 472 (a). The adjustment was to prevent the omission of $97,571.77 from taxable income when the partnership shifted from a cash basis treatment of “dealer reserve income” (income withheld by a finance company as security on notes discounted to them by the dealer for the purchase of new automobiles until complete payment of…