Simplified Tax Records, Inc. v. Commissioner
United States Tax Court
Petitioner sold accounting systems to small businesses throughout the country and also agreed to prepare the income tax returns of the subscribers for 2 years on request, all for a single package price, all of which was included in petitioner's gross sales for the year of sale.
Read the full summary
Petitioner sold accounting systems to small businesses throughout the country and also agreed to prepare the income tax returns of the subscribers for 2 years on request, all for a single package price, all of which was included in petitioner's gross sales for the year of sale. In 1954 petitioner established a reserve for the estimated future cost of preparing subscribers' returns and deducted additions thereto as a part of the cost of goods sold on its returns for 1954 and 1956. Held, respondent did not err in disallowing the deductions.
1Opinion of the Court
OPINION
The principal issue is whether respondent erred in disallowing a deduction for estimated future expenses of preparing subscribers’ income tax returns which petitioner had claimed as a part of its cost of goods sold on its income tax returns for 1954 and 1956.
This is another of the plethora of cases coming before the courts in recent years involving the deferral of income or the accrual of expenses to cover the estimated cost of rendering services in the future. We think the issue here is controlled by the recent decisions of the Supreme Court in Schlude v. Commissioner, 372 U.S. 128…
2Cases cited18 opinions
- Automobile Club of Mich. v. CommissionerSupreme Court of the United States · 1957
- Brown v. HelveringSupreme Court of the United States · 1934
- American Automobile Assn. v. United StatesSupreme Court of the United States · 1961
- Schulde v. CommissionerSupreme Court of the United States · 1963
- Beacon Publishing Company, a Kansas Corporation v. Commissioner of Internal RevenueCourt of Appeals for the Tenth Circuit · 1955
13 more not listed; retrieve them via the Exa API.
3Cited by30 opinions
- World Airways, Inc. v. CommissionerUnited States Tax Court · 1974
- Mooney Aircraft, Inc. v. United StatesCourt of Appeals for the Fifth Circuit · 1970
- Hagen Advertising Displays, Inc. v. CommissionerUnited States Tax Court · 1966
- Thriftimart, Inc. v. CommissionerUnited States Tax Court · 1973
- Charles Schwab Corp. v. CommissionerUnited States Tax Court · 1996
25 more not listed; retrieve them via the Exa API.