Trianon Hotel Co. v. Commissioner
United States Board of Tax Appeals
1. The "aggregate of the amounts which can be distributed within the taxable year as dividends without violating a provision of a written contract executed by the corporation prior to May 1, 1936" includes undivided profits on hand at the beginning of the taxable year and the current net earnings of that year. 2. Where the amount of a corporation's adjusted net income for the taxable year does not exceed the aggregate of the amounts which can be distributed as dividends…
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1. The "aggregate of the amounts which can be distributed within the taxable year as dividends without violating a provision of a written contract executed by the corporation prior to May 1, 1936" includes undivided profits on hand at the beginning of the taxable year and the current net earnings of that year. 2. Where the amount of a corporation's adjusted net income for the taxable year does not exceed the aggregate of the amounts which can be distributed as dividends without violating the provision of a written contract executed prior to May 1, 1936, it is not entitled to a credit under…
1Opinion of the Court
*1079OPINION.
Mellott:
The pertinent provisions of the Revenue Act of 1936 are shown in the margin.1
Petitioner’s first contention is that it was restricted in the payment of dividends in the taxable year by the provisions of a written contract executed by it prior to May 1, 1936, which required it to set aside $20,000 out of net earnings in 1936 for the purpose of discharging its covenant to satisfy the Muehlebach creditors’ claims. It claims that it is therefore entitled to the credit provided by section 26 (c) (1), supra.
The evidence presented by petitioner indicates that it did enter into a…
2Cited by4 opinions
- Bishop & B. Mfg. Co. v. CommissionerUnited States Board of Tax Appeals · 1941
- L. O. Koven & Bro., Inc. v. CommissionerUnited States Board of Tax Appeals · 1942
- Pacific Southwest Realty Co. v. CommissionerUnited States Board of Tax Appeals · 1941
- Trianon Hotel Co. v. CommissionerUnited States Board of Tax Appeals · 1941