Schmidt Baking Co. v. Commissioner
United States Tax Court
P funded its vacation and severance pay obligations to its employees for 1991 by purchasing an irrevocable letter of credit on March 13, 1992. The letter of credit constituted a transfer of an interest in substantially vested property, includable in income of the employees as of that date under sec. 83, I.R.C.
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P funded its vacation and severance pay obligations to its employees for 1991 by purchasing an irrevocable letter of credit on March 13, 1992. The letter of credit constituted a transfer of an interest in substantially vested property, includable in income of the employees as of that date under sec. 83, I.R.C. P, an accrual basis taxpayer, deducted the amount of the letter of credit on its 1991 return on the basis that it paid the vacation pay within 2-1/2 months of the close of its 1991 taxable year and was therefore entitled to the claimed deduction under sec. 83(h), I.R.C., and sec.…
1Opinion of the Court
OPINION
Tannenwald, Judge:
Respondent determined the following deficiencies in petitioner’s Federal income taxes:
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After concessions, the sole issue for decision is whether petitioner may deduct for its 1991 tax year amounts for vacation and severance pay which accrued in that year; were funded within 2Vz months of the end of that year, i.e., March 13, 1992, by means of an irrevocable letter of credit; and were includable in the income of the employees as of that date.
Background
This case was submitted fully stipulated under Rule 122.1 The stipulation of facts and supplemental…
2Cases cited10 opinions
- Zinniel v. CommissionerUnited States Tax Court · 1987
- Truck & Equipment Corp. v. CommissionerUnited States Tax Court · 1992
- Albertson's, Inc. v. CommissionerUnited States Tax Court · 1990
- Albertson's, Inc., Petitioner-Appellant-Cross-Appellee v. Commissioner of Internal Revenue, Respondent-Appellee-Cross-AppellantCourt of Appeals for the Ninth Circuit · 1994
- Hospital Corp. of Am. v. CommissionerUnited States Tax Court · 1996
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3Cited by6 opinions
- Venture Funding v. CommissionerUnited States Tax Court · 1998
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- Schmidt Baking Company, Inc. v. CommissionerUnited States Tax Court · 1996
- Venture Funding v. CommissionerUnited States Tax Court · 1998
- Venture Funding v. CommissionerUnited States Tax Court · 1998
1 more not listed; retrieve them via the Exa API.