Fulk & Needham, Inc. v. United States

SOBELOFF, Circuit Judge:

The single question raised in this action for refund of corporate income taxes is whether the appellant-taxpayer, Fulk & Needham, Ine„ was eligible for treatment as a small business corporation under subchapter S of the Internal Revenue Code during the years 1960, 1961 and 1962. In order to obtain subchapter S treatment, a corporation must make a valid election to have its income taxed directly to its shareholders. 1 In this case appellant made an election in November, 1958, which, if valid, would be effective for the calendar year 1959 and succeeding years, thus…