Russell Milling Co. v. Commissioner

A corporation making its returns on a fiscal year basis may not deduct income or excess-profits taxes imposed by the Revenue Act of 1917 for the portion of its fiscal year 1917 within the calendar year 1917, as having accrued at December 31, 1916. State, county, and municipal taxes paid or accrued within the fiscal year are allowable deductions from gross income in that year. Such taxes can be accrued only when they become due, and no part thereof can be accrued and deducted in ascertaining net income when the due date is not within the fiscal year. A reserve for depreciation accumulated on…