Lillie v. Commissioner
United States Tax Court
Petitioners, who use the cash method of accounting, made substantial end-of-year payments to cattle-feeding companies for feed and services to be supplied in subsequent years.
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Petitioners, who use the cash method of accounting, made substantial end-of-year payments to cattle-feeding companies for feed and services to be supplied in subsequent years. Petitioners were not required to pay in advance; there was no shortage of feed; the payments secured no preferential treatment; they were charged the current market price for feed and services; the cost of both feed and services was charged against their credit balances at the cattle-feeding companies; and they received refunds in 1961 from one of the companies. Held, that such payments were in reality deposits and…
1Opinion of the Court
Dawson, Judge:
In these consolidated proceedings respondent determined the following deficiencies and additions to tax:
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All issues except one in docket No. 5040-63 have been settled by the parties and will be given effect in the Rule 50 computation. The only issue remaining for decision, which is common to both proceedings, is whether large end-of-year payments made by petitioners to cattle-feeding companies are deductible as ordinary and necessary business expenses under section 162(a), I.R.C. 1954, in the year of payment rather than in the subsequent year during which feed and…
2Cases cited8 opinions
- R D. And Ida M. Cravens v. Commissioner of Internal RevenueCourt of Appeals for the Tenth Circuit · 1959
- Veenstra & De Haan Coal Co. v. CommissionerUnited States Tax Court · 1948
- Rose v. United StatesCourt of Appeals for the Third Circuit · 1958
- Cravens v. CommissionerUnited States Tax Court · 1958
- George R. Shippy, George Shippy, Jr., Wilda Shippy, Harold Shippy, and Deloris Shippy v. United StatesCourt of Appeals for the Eighth Circuit · 1962
3 more not listed; retrieve them via the Exa API.
3Cited by35 opinions
- Sandor v. CommissionerUnited States Tax Court · 1974
- E. Keith Owens v. Commissioner of Internal RevenueCourt of Appeals for the Sixth Circuit · 1977
- Packard v. CommissionerUnited States Tax Court · 1985
- Keller v. CommissionerUnited States Tax Court · 1982
- Owens v. CommissionerUnited States Tax Court · 1975
30 more not listed; retrieve them via the Exa API.