Lutz & Schramm Co. v. Commissioner
United States Tax Court
1. Deduction -- Bad Debts -- Additions To Reserve. -- The petitioner shows on its opening balance sheet, as of the date of its organization in 1924, certain accounts receivable against which it set up on that balance sheet a reserve of $ 16,033.01. This amount was not claimed or allowed as a deduction for additions to the reserve for bad debts.
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1. Deduction -- Bad Debts -- Additions To Reserve. -- The petitioner shows on its opening balance sheet, as of the date of its organization in 1924, certain accounts receivable against which it set up on that balance sheet a reserve of $ 16,033.01. This amount was not claimed or allowed as a deduction for additions to the reserve for bad debts. The deductions claimed and allowed for additions to the reserve for bad debts up to the beginning of the taxable year exceeded the bad debts charged off against the reserve by only $ 2,882.23. Reasonable additions to the reserve for bad debts for 1936…
1Opinion of the Court
OPINION.
Murdock, Judge:
The Commissioner disallowed the deductions of additions to the reserve for bad debts for the reason that the balance in the reserve at the beginning of the first taxable year was adequate, but the information he gave in regard to the amount of that balance was erroneous. The petitioner introduced evidence showing the additions to its reserve as allowed by the Commissioner for its entire history, the amount of bad debts actually charged off against that reserve, net sales for all years, and accounts receivable at the end of each year. It seems proper to conclude that no…
2Cases cited2 opinions
- United States v. Kirby Lumber CoSupreme Court of the United States · 1931
- Lakeland Grocery Co. v. CommissionerUnited States Board of Tax Appeals · 1937
3Cited by44 opinions
- Commissioner v. TuftsSupreme Court of the United States · 1983
- Smith v. CommissionerUnited States Tax Court · 1982
- Danenberg v. CommissionerUnited States Tax Court · 1979
- Platt Trailer Co. v. CommissionerUnited States Tax Court · 1955
- Estate of Delman v. CommissionerUnited States Tax Court · 1979
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