C. L. Downey Co. v. Commissioner
United States Tax Court
1. Borrowed Invested Capital -- Indebtedness -- Sec. 719 (a) (1). -- Money advanced by a chamber of commerce to induce a new business to locate in its city, which money was to be repaid only in case the pay roll of the taxpayer did not reach a certain total within a stated time, should not be represented in borrowed invested capital, even though a note and deed of trust were executed, to mature only after the stated time. 2. Deduction -- Depreciation -- Basis -- Contribution…
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1. Borrowed Invested Capital -- Indebtedness -- Sec. 719 (a) (1). -- Money advanced by a chamber of commerce to induce a new business to locate in its city, which money was to be repaid only in case the pay roll of the taxpayer did not reach a certain total within a stated time, should not be represented in borrowed invested capital, even though a note and deed of trust were executed, to mature only after the stated time. 2. Deduction -- Depreciation -- Basis -- Contribution -- Sec. 23 (l) (1). -- Where a chamber of commerce, to induce new business to locate in the city, pays money towards…
1Opinion of the Court
OPINION.
Murdock, Judge:
The Commissioner determined deficiencies in excess profits tax of $3,581.06 for 1942 and $3,152.64 for 1943, and a deficiency of $84.03 in declared value excess profits tax for 1943. The issues for decision are: (1) Whether the Commissioner erroneously disallowed, as borrowed invested capital for each year, $28,000 representing an alleged loan to the taxpayer by the Hannibal Chamber of Commerce; (2) whether the Commissioner erred in eliminating from the depreciable base, $25,000 made available to the petitioner by the Chamber of Commerce of the City of Hannibal,…
2Cases cited4 opinions
- United States v. LudeySupreme Court of the United States · 1927
- Detroit Edison Co. v. CommissionerSupreme Court of the United States · 1943
- Journal Publishing Co. v. CommissionerUnited States Tax Court · 1944
- Consolidated Goldacres Co. v. CommissionerUnited States Tax Court · 1947
3Cited by13 opinions
- Clark v. CommissionerUnited States Tax Court · 1952
- CL Downey Co. v. Commissioner of Internal RevenueCourt of Appeals for the Eighth Circuit · 1949
- Fraser-Smith Co. v. CommissionerUnited States Tax Court · 1950
- North American Loan & Thrift Co. v. CommissionerUnited States Tax Court · 1962
- Burford-Toothaker Tractor Co. v. United StatesDistrict Court, M.D. Alabama · 1958
8 more not listed; retrieve them via the Exa API.