Untermyer v. Commissioner of Internal Revenue

The petitioner, a citizen and resident of the United States, in 1922, received a dividend of $42,000 from a mining corporation of Canada. In his tax return for that year, he reported $20,815.20, as representing a taxable dividend, and the balance of $21,-184.80, as not subject to income tax, pursuant to advices received from the Canadian mining company, upon the ground that this sum was paid from a fund which was set apart by the corporation as representing, according to the tax authorities of the Dominion of Canada, a proper deduction for depletion. This amount was consistent with the…