Seavey & Flarsheim Brokerage Co. v. Commissioner
United States Board of Tax Appeals
In 1928 petitioner, in order to retain the services of a valuable employee, agreed, in addition to the compensation he was then receiving for his services, to pay to his widow after his death $12,000 per year from the net earnings attributable to its St. Louis office.
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In 1928 petitioner, in order to retain the services of a valuable employee, agreed, in addition to the compensation he was then receiving for his services, to pay to his widow after his death $12,000 per year from the net earnings attributable to its St. Louis office. Held, payment made to the widow in 1934 under the terms of the agreement was an ordinary and necessary expense paid or incurred during the taxable year in connection with petitioner's business and is deductible from gross income.
1Opinion of the Court
*200 OPINION.
Keen:
The sole question before us is whether respondent erred in disallowing as a deduction from -petitioner’s gross income the $12,000 paid to Jennie Flarsheim in the taxable year.
Petitioner contends that the $12,000 in question should not be included in its gross income, but if so included it should be deducted in computing its net income, either as an expense or as exhaustion of the cost of the contract for Milton’s services. The respondent contends that it is income to petitioner and is not deductible either as *201an ordinary and necessary expense, or as exhaustion of a capital…
2Cases cited6 opinions
- Lucas v. EarlSupreme Court of the United States · 1930
- Blair v. CommissionerSupreme Court of the United States · 1937
- Kornhauser v. United StatesSupreme Court of the United States · 1928
- Burnet v. LeiningerSupreme Court of the United States · 1932
- Lucas v. Ox Fibre Brush Co.Supreme Court of the United States · 1930
1 more not listed; retrieve them via the Exa API.
3Cited by18 opinions
- I. Putnam, Inc. v. CommissionerUnited States Tax Court · 1950
- Fitzpatrick v. State Tax CommissionUtah Supreme Court · 1963
- Loewy Drug Co. of Baltimore City v. United StatesDistrict Court, D. Maryland · 1964
- Consumers Power Company v. United States of America, Consumers Power Company, Cross-Appellant v. United States of America, Cross-AppelleeCourt of Appeals for the Sixth Circuit · 1970
- Jordanos', Inc., Madeline F. Jordano, Howard H. King and Delfina I. King, Helen M. Jordano v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1968
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