Columbia, N. & L. R. Co. v. Commissioner
United States Tax Court
Excess Profits Tax -- Credit Based Upon Invested Capital -- Borrowed Capital -- Indebtedness "Not Including Interest." -- Certificates of indebtedness issued by a corporation to its bondholders as consideration for their agreement to reduce the future rate of interest payable on its bonds do not evidence an "outstanding indebtedness (not including interest)" within the meaning of section 719 (a) (1), I. R. C., for the purpose of computing the corporation's excess profits…
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Excess Profits Tax -- Credit Based Upon Invested Capital -- Borrowed Capital -- Indebtedness "Not Including Interest." -- Certificates of indebtedness issued by a corporation to its bondholders as consideration for their agreement to reduce the future rate of interest payable on its bonds do not evidence an "outstanding indebtedness (not including interest)" within the meaning of section 719 (a) (1), I. R. C., for the purpose of computing the corporation's excess profits credit based upon invested capital.
1Opinion of the Court
OPINION.
Murdock, Judge:
The Commissioner determined deficiencies against the petitioner as follows:
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The only issue is whether amounts evidenced by certificates of indebtedness issued by the petitioner to its bondholders in 1900 for past due interest and to reduce the interest rate for later years constitute borrowed capital under section 719 of the Internal Revenue Code for the purpose of computing its excess profits credit based on invested capital for the taxable years.
The facts have been stipulated.
The petitioner, a corporation, was organized under the laws of South Carolina in…
2Cases cited2 opinions
- Player Realty Co. v. CommissionerUnited States Tax Court · 1947
- Palm Beach Trust Co. v. CommissionerUnited States Tax Court · 1947
3Cited by4 opinions
- Society Brand Clothes, Inc. v. CommissionerUnited States Tax Court · 1952
- Columbia, N. & L. R. Co. v. CommissionerUnited States Tax Court · 1950
- Society Brand Clothes, Inc. v. CommissionerUnited States Tax Court · 1952
- Society Brand Clothes, Inc. v. CommissionerUnited States Tax Court · 1952