Boston E. R. Co. v. Commissioner
United States Tax Court
1. Under Massachusetts law petitioner was in effect guaranteed a level of income sufficient to meet its operating costs and to pay dividends to its stockholders at a specified rate.
Read the full summary
1. Under Massachusetts law petitioner was in effect guaranteed a level of income sufficient to meet its operating costs and to pay dividends to its stockholders at a specified rate. Although petitioner's books disclosed deficits for periods ending in 1941, amounts payable by the Commonwealth of Massachusetts pursuant to the guarantee held not accruable as income in 1941 by reason of the fact that the commonwealth was challenging the legality of the accounting procedures whereby such deficits were computed, and it was not possible to make any reasonable estimate in 1941 as to what amounts, if…
1Opinion of the Court
OPINION.
Raum, Judge:
1. Petitioner employed the accrual method of accounting, and there is no dispute here that payments due from the State of Massachusetts on account of the so-called cost of service deficits would constitute taxable income in the year or years that they were properly accruable. Boston Elevated Railway Co., 45 B. T. A. 906, affd. (C. A. 1), 131 F. 2d 161, certiorari denied, 318 U. S. 760. The cost of service deficits herein for which petitioner sought reimbursement from the state were claimed to be $2,341,167.29 for the 12-month period ending March 31, 1941, and $1,311,406.44…
2Cases cited24 opinions
- United States v. AndersonSupreme Court of the United States · 1926
- North American Oil Consolidated v. BurnetSupreme Court of the United States · 1932
- Lucas v. American Code Co.Supreme Court of the United States · 1930
- Security Flour Mills Co. v. CommissionerSupreme Court of the United States · 1944
- Dixie Pine Products Co. v. CommissionerSupreme Court of the United States · 1944
19 more not listed; retrieve them via the Exa API.
3Cited by1 opinion
- Boston E. R. Co. v. CommissionerUnited States Tax Court · 1951