Ames v. Commissioner
United States Board of Tax Appeals
Petitioner owned all the outstanding stock of a corporation which he had organized to carry on his individual business of producing plays. No one else was associated with the petitioner in managing the affairs of the corporation and he devoted all his working hours to the business. Petitioner supplied the necessary capital by making personal loans to the corporation.
Read the full summary
Petitioner owned all the outstanding stock of a corporation which he had organized to carry on his individual business of producing plays. No one else was associated with the petitioner in managing the affairs of the corporation and he devoted all his working hours to the business. Petitioner supplied the necessary capital by making personal loans to the corporation. In 1922 the corporation, being unable to repay these loans, confessed judgment in favor of the petitioner in the sum of $719,223.68, which amount was subsequently reduced to $504,372.18. Petitioner took over all the assets of the…
1Opinion of the Court
*733OPINION.
Matthews:
There is no dispute as to the facts in this case or as to the computation of the deficiency. The sole question presented is whether the loss sustained by the petitioner in 1922 is a net loss within the meaning of section 204 of the Revenue Act of 1921 so that the unabsorbed portion thereof may be deducted in computing petitioner’s taxable income for 1924. In order to constitute a net loss which may be applied against petitioner’s income of succeeding years in accordance with the provisions of the statute it must be shown that the loss resulted from the operation of a business…
2Cases cited3 opinions
- Burnet v. ClarkSupreme Court of the United States · 1932
- Burnet v. Commonwealth Improvement Co.Supreme Court of the United States · 1932
- Dalton v. BowersSupreme Court of the United States · 1932
3Cited by2 opinions
- Ames v. CommissionerUnited States Board of Tax Appeals · 1933
- Cavedon v. CommissionerUnited States Board of Tax Appeals · 1934