Cropland Chem. Corp. v. Commissioner
United States Tax Court
Petitioner, with another corporation, formed a joint venture to acquire, produce, and sell agricultural products. Petitioner's president and sole shareholder, T, entered into an employment contract with the joint venture, under which he was compensated for services rendered thereto.
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Petitioner, with another corporation, formed a joint venture to acquire, produce, and sell agricultural products. Petitioner's president and sole shareholder, T, entered into an employment contract with the joint venture, under which he was compensated for services rendered thereto. Held, amounts paid to T by petitioner as compensation for services actually rendered to the joint venture are not deductible by petitioner since they were not ordinary and necessary expenses of petitioner and T was not acting as petitioner's agent in rendering services to the joint venture. Held, further,…
1Opinion of the Court
Nims, Judge:
Respondent determined deficiencies in petitioner’s income tax for its fiscal years ended February 28,1974, and February 28, 1975, in the amounts of $34,501 and $130,181, respectively. The issues for decision are whether petitioner may deduct as compensation amounts paid to Robert A. Trowbridge and Delores S. Trowbridge and amounts contributed on behalf of said individuals to a pension plan and profit-sharing plan maintained by petitioner. The parties agree that the resolution of the first issue will automatically dispose of the second issue.
FINDINGS OF FACT
Some of the facts have…
2Cases cited7 opinions
- Welch v. HelveringSupreme Court of the United States · 1933
- Lucas v. Ox Fibre Brush Co.Supreme Court of the United States · 1930
- R. J. Nicoll Co. v. CommissionerUnited States Tax Court · 1972
- Wallendal v. CommissionerUnited States Tax Court · 1959
- Wilson v. CommissionerUnited States Board of Tax Appeals · 1929
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