Package Mach. Co. v. Commissioner

In addition to the regular salaries paid in cash to its officers, who were rendering valuable services of a specialized nature, petitioner, prior to the tax year, provided that, after setting aside out of net profits certain amounts for sinking fund and dividend purposes, "25% of the balance of the net earnings shall be paid to the officers aforesaid in the proportion hereinafter set forth, said payment to be made in common stock of the company at par." Held, the liability of petitioner to its officers under the agreement was not for a specific sum in terms of dollars and cents, but for a…