Faulk v. Commissioner
United States Tax Court
The United States, under section 231 of Title 31 of the United States Code, recovered judgment against a taxpayer for submitting false and fraudulent claims against the Government and was awarded double the amount of damages sustained by the United States by reason of such acts.
Read the full summary
The United States, under section 231 of Title 31 of the United States Code, recovered judgment against a taxpayer for submitting false and fraudulent claims against the Government and was awarded double the amount of damages sustained by the United States by reason of such acts. Held, under the facts, the payment of the judgment, attorneys' fees, and other expenses incurred by taxpayer incident to the litigation are not deductible by him as ordinary and necessary business expenses under section 23 (a), Internal Revenue Code of 1939.
1Opinion of the Court
OPINION.
Johnson, Judge:
The Commissioner determined a deficiency in petitioners’ income tax for 1952 in the amount of $14,876.67.
The issues for decision are whether petitioners are entitled to a deduction, as ordinary and necessary business expenses, of the following: (a) $28,638.72 paid by petitioners to the United States as double damages on a judgment rendered against petitioner David R. Faulk, arising out of a civil action brought by the Government for knowingly presenting false claims to the Government; (b) in the alternative, for one-half of the sum paid in satisfaction of such judgment;…
2Cases cited11 opinions
- United States Ex Rel. Marcus v. HessSupreme Court of the United States · 1943
- Commissioner v. HeiningerSupreme Court of the United States · 1943
- Jerry Rossman Corporation v. Commissioner of Int. Rev.Court of Appeals for the Second Circuit · 1949
- United States Ex Rel. Brensilber v. Bausch & Lomb Optical Co.Court of Appeals for the Second Circuit · 1942
- National Brass Works, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1950
6 more not listed; retrieve them via the Exa API.
3Cited by9 opinions
- Smith v. CommissionerUnited States Tax Court · 1960
- Grossman & Sons v. CommissionerUnited States Tax Court · 1967
- Walter F. Tellier and Evelyn H. Tellier v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1965
- Faulk v. CommissionerUnited States Tax Court · 1956
- Grossman & Sons v. CommissionerUnited States Tax Court · 1967
4 more not listed; retrieve them via the Exa API.