Fraser-Smith Co. v. Commissioner
United States Tax Court
Petitioner drew sight drafts on its customers, payable to its bank, to which it attached bills of lading endorsed in blank. The instruments were delivered to the bank, which credited petitioner's account with the face amount of the drafts and allowed it to draw immediately against that credit. Held, the amounts credited are not borrowed capital within the meaning of section 719 (a) (1) of the Internal Revenue Code.
1Opinion of the Court
Fraser-Smith Company, Petitioner, v. Commissioner of Internal Revenue, Respondent
Fraser-Smith Co. v. Commissioner
Docket No. 18375
United States Tax Court
14 T.C. 892; 1950 U.S. Tax Ct. LEXIS 195;
May 19, 1950, Promulgated
Decision will be entered for the respondent.
Petitioner drew sight drafts on its customers, payable to its bank, to which it attached bills of lading endorsed in blank. The instruments were delivered to the bank, which credited petitioner's account with the face amount of the drafts and allowed it to draw immediately against that credit. Held, the amounts credited are not…
2Cases cited11 opinions
- Burton v. United StatesSupreme Court of the United States · 1905
- City of Douglas v. Federal Reserve Bank of DallasSupreme Court of the United States · 1926
- Vickers v. Machinery Warehouse & Sales Co.Washington Supreme Court · 1920
- Player Realty Co. v. CommissionerUnited States Tax Court · 1947
- Union Electric Steel Co. v. Imperial BankCourt of Appeals for the Third Circuit · 1923
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