Dielectric Materials Co. v. Commissioner
United States Tax Court
1. Held, of $ 142,234 paid to petitioner's president and principal shareholder in the taxable year 1966, by way of salary and commissions, $ 110,000 constituted reasonable compensation for services rendered. 2. Further held, petitioner failed to sustain its burden of proof that respondent's determination of the useful life of a factory building was incorrect. 3. Further held, in light of the conceded reasonable needs of the business and the potential consequences of an…
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1. Held, of $ 142,234 paid to petitioner's president and principal shareholder in the taxable year 1966, by way of salary and commissions, $ 110,000 constituted reasonable compensation for services rendered. 2. Further held, petitioner failed to sustain its burden of proof that respondent's determination of the useful life of a factory building was incorrect. 3. Further held, in light of the conceded reasonable needs of the business and the potential consequences of an impending strike, petitioner is not subject to the accumulated-earnings tax for the taxable year 1966 under sec. 531, I.R.C.…
1Opinion of the Court
TanNENWAld, Judge:
Respondent asserted a deficiency of $32,442.51 in petitioner’s income tax for 1966. Petitioner has conceded the correctness of one of respondent’s adjustments, leaving the following issues for decision:(1) Whether compensation paid by petitioner to its president and principal shareholder was reasonable in amount so as to be deductible under section 162(a) (1) 1;(2) Whether the useful life of petitioner’s factory building is 45 years, as contended by respondent, or 30 years, as contended by petitioner; and(3) Whether petitioner is subject to the aceumulated-earnings tax…
2Cases cited13 opinions
- Botany Worsted Mills v. United StatesSupreme Court of the United States · 1929
- Casey v. CommissionerUnited States Tax Court · 1962
- Faber Cement Block Co. v. CommissionerUnited States Tax Court · 1968
- Mennuto v. CommissionerUnited States Tax Court · 1971
- Burford-Toothaker Tractor Co. v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1951
8 more not listed; retrieve them via the Exa API.
3Cited by60 opinions
- Pepsi-Cola Bottling Co. v. CommissionerUnited States Tax Court · 1974
- Kennedy v. CommissionerUnited States Tax Court · 1979
- Doug-Long, Inc. v. CommissionerUnited States Tax Court · 1979
- Proctor v. CommissionerUnited States Tax Court · 1981
- Ready Paving & Constr. Co. v. CommissionerUnited States Tax Court · 1974
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