Koons v. Commissioner
United States Tax Court
Petitioner, John F. Koons, purchased an undeveloped invention during the taxable year 1955 for $ 5,000 and paid $ 45,000 to a research laboratory for its services in perfecting the invention into a patentable and commercial product. In 1958 letters patent were issued to petitioner covering said invention. Virtually all contacts by the laboratory relating to the development of said invention were made with petitioner's son as authorized agent of petitioner.
Read the full summary
Petitioner, John F. Koons, purchased an undeveloped invention during the taxable year 1955 for $ 5,000 and paid $ 45,000 to a research laboratory for its services in perfecting the invention into a patentable and commercial product. In 1958 letters patent were issued to petitioner covering said invention. Virtually all contacts by the laboratory relating to the development of said invention were made with petitioner's son as authorized agent of petitioner. During 1955, petitioner's primary source of income was derived from an advertising agency in which he was an active partner. For many…
1Opinion of the Court
Fisher, Judge:
Respondent determined a deficiency in petitioners’ income tax for the year 1955 in the amount of $10,991.04.
The sole issue presented for our consideration is whether expenditures made by petitioners in 1955 in the amount of $45,000 or any part thereof constituted research and experimental expenditures paid or incurred in connection with his trade or business within the intendment of section 174 (a) (1) of the Code of 1954.
FINDINGS OF FACT.
Some of the facts are stipulated and, together with exhibits filed in accordance with the stipulation, are included herein by reference.
Petitio…
2Cases cited12 opinions
- Higgins v. CommissionerSupreme Court of the United States · 1941
- McDonald v. CommissionerSupreme Court of the United States · 1944
- Frank v. CommissionerUnited States Tax Court · 1953
- Dwight A. Ward v. Commissioner of Internal Revenue, Hanna P. Ward v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1955
- Walet v. CommissionerUnited States Tax Court · 1958
7 more not listed; retrieve them via the Exa API.
3Cited by67 opinions
- Richmond Television Corporation v. United StatesCourt of Appeals for the Fourth Circuit · 1965
- Jackson v. CommissionerUnited States Tax Court · 1986
- Durovic v. CommissionerUnited States Tax Court · 1970
- Green v. Comm'rUnited States Tax Court · 1984
- Levin v. CommissionerUnited States Tax Court · 1986
62 more not listed; retrieve them via the Exa API.