Rooney v. Commissioner
United States Tax Court
Ps, who were partners in a certified public accounting firm, rendered accounting services and billed clients for such services. Several clients became delinquent in paying such bills, and to reduce the amounts owed, Ps accepted goods and services from such clients. Ps determined that the value to them of such goods and services was less than the retail price and reduced the partnership's gross receipts by a discount determined by them.
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Ps, who were partners in a certified public accounting firm, rendered accounting services and billed clients for such services. Several clients became delinquent in paying such bills, and to reduce the amounts owed, Ps accepted goods and services from such clients. Ps determined that the value to them of such goods and services was less than the retail price and reduced the partnership's gross receipts by a discount determined by them. Held, under sec. 61, I.R.C. 1954, an objective measure of fair market value must be employed to measure compensation received in goods or services; thus, Ps…
1Opinion of the Court
SIMPSON, Judge:
The Commissioner determined deficiencies in the petitioners’ Federal income taxes for 1981 as follows:
Petitioners Deficiency
David A. and Jeanne R. Rooney. $187
Richard A. and Patricia D. Plotkin. 213
Grafton H. Willey IV. 134
After concessions by the petitioners, the sole issue remaining for our decision is whether an accounting partnership, in computing its income, may discount the retail prices of goods and services received in exchange for accounting services by considering the partners’ subjective determination of value.
FINDINGS OF FACT
Some of the facts have been stipulated,…
2Cases cited5 opinions
- Pessin v. CommissionerUnited States Tax Court · 1972
- Flora L. Champion, Individually and as Independent of the Estate of Frank Champion, Deceased v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1962
- Verlin W. And Anna Jo Koons v. United States of America, Charles H. And Cecelia Parker v. United StatesCourt of Appeals for the Ninth Circuit · 1963
- Wright v. CommissionerUnited States Board of Tax Appeals · 1941
- Kaplan v. United StatesDistrict Court, D. Arizona · 1967
3Cited by9 opinions
- G.M. Trading Corp. v. CommissionerUnited States Tax Court · 1996
- Baker v. CommissionerUnited States Tax Court · 1987
- Badell v. CommissionerUnited States Tax Court · 2000
- Baker v. CommissionerUnited States Tax Court · 1987
- DeBrouse v. CommissionerUnited States Tax Court · 1988
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