Frank J. Shippen v. Commissioner of Internal Revenue

RIVES, Chief Judge.

The taxpayer and one Charles M. Kyne were partners engaged in buying and selling lumber at wholesale. The partnership frequently made cash advances to mill operators against lumber to be supplied by them. Kyne furnished the capital for the operation of the partnership and the taxpayer devoted his entire working time to its operation. The taxpayer agreed to “personally guarantee the collection, in a reasonable time, of credits given to customers, or advances to lumber mills for the securing of lumber.” Pursuant to that provision, in the latter part of December 1951, the…