Dean v. Commissioner
United States Tax Court
Incentive pay measured by a percentage of sales of certain departments of a manufacturing corporation was authorized by its board of directors in 1943, but was withheld because of a ruling of the Salary Stabilization Unit of the Bureau of Internal Revenue that additional compensation for 1943 could not exceed the amount paid during 1942. In 1944 the Unit reversed its 1943 ruling and authorized the payment of this additional compensation.
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Incentive pay measured by a percentage of sales of certain departments of a manufacturing corporation was authorized by its board of directors in 1943, but was withheld because of a ruling of the Salary Stabilization Unit of the Bureau of Internal Revenue that additional compensation for 1943 could not exceed the amount paid during 1942. In 1944 the Unit reversed its 1943 ruling and authorized the payment of this additional compensation. Held, amount received by petitioner in 1944 for services rendered in 1943 is "back pay" as defined in section 107 (d) (2), I. R. C.
1Opinion of the Court
OPINION.
HaRlan, Judge:
The respondent contends that the $13,045.32 received by petitioner in 1944, under the contract of April 1,1942, was a share of the profits of ERCO, and did not constitute “back pay” under the provisions of subsection (2) of section 107 (d) of the Internal Revenue Code. Section 107 (d) is set forth in the margin.1
The petitioner contends that the $13,045.32 payment was for services performed prior to the taxable year, that it was made retroactive with the approval of the Salary Stabilization Unit, and that it constituted “back pay” under the provisions of section 107 (d)…
2Cases cited1 opinion
- Kenny v. CommissionerUnited States Tax Court · 1945
3Cited by10 opinions
- Wardall v. United StatesUnited States Court of Claims · 1953
- Robillard v. CommissionerUnited States Tax Court · 1961
- Hagner v. CommissionerUnited States Tax Court · 1950
- Bavis v. CommissionerUnited States Tax Court · 1952
- Bavis v. CommissionerUnited States Tax Court · 1952
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