Friedlander Corp. v. Commissioner
United States Tax Court
1. Business Deduction. -- Rotary Club dues of petitioner's president and majority stockholder held not deductible. 2. Salaries of Employees Disallowed in Part. -- Payment of salaries and bonuses paid to stockholder sons of administrative head of petitioner during period of employees' absence in military service, no replacements being required in the business, held properly disallowed in part by respondent. 3. Partnership. -- Respondent determined a deficiency against…
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1. Business Deduction. -- Rotary Club dues of petitioner's president and majority stockholder held not deductible. 2. Salaries of Employees Disallowed in Part. -- Payment of salaries and bonuses paid to stockholder sons of administrative head of petitioner during period of employees' absence in military service, no replacements being required in the business, held properly disallowed in part by respondent. 3. Partnership. -- Respondent determined a deficiency against petitioner on the theory that partnership made up of a portion of petitioner's stockholders was a sham. Petitioner seeks…
1Opinion of the Court
OPINION.
Withey, Judge:
Petitioner contends that the membership in the Notary Club afforded an opportunity for Louis, its president, to contact leading business and professional citizens of the community and create good will for the business. Substantial evidence is required to establish a right to deduct club dues as a business expense. George K. Gann, 41 B. T. A. 388. Cf. Smith-Bridgman & Co., 16 T. C. 287, 295.
The fact that Louis paid the sum out of his personal funds during the course of his membership in the club for 21 years prior to the taxable year without any contention or proof that…
2Cases cited9 opinions
- Gregory v. HelveringSupreme Court of the United States · 1935
- Lucas v. EarlSupreme Court of the United States · 1930
- Commissioner v. CulbertsonSupreme Court of the United States · 1949
- Higgins v. SmithSupreme Court of the United States · 1940
- Harrison v. SchaffnerSupreme Court of the United States · 1941
4 more not listed; retrieve them via the Exa API.
3Cited by1 opinion
- Friedlander Corp. v. CommissionerUnited States Tax Court · 1953