New York Talking Mach. Co. v. Commissioner
United States Board of Tax Appeals
1. Fixed salaries and additional compensation based on profits authorized and paid to officers during the years 1918 and 1919 allowed as an expense deduction where such compensation was for personal services actually rendered and was reasonable in amount. 2. A notice of a deficiency sent to one of two affiliated corporations which does not show a determination of any additional tax liability on behalf of the other affiliated company does not, in the absence of any agreement…
Read the full summary
1. Fixed salaries and additional compensation based on profits authorized and paid to officers during the years 1918 and 1919 allowed as an expense deduction where such compensation was for personal services actually rendered and was reasonable in amount. 2. A notice of a deficiency sent to one of two affiliated corporations which does not show a determination of any additional tax liability on behalf of the other affiliated company does not, in the absence of any agreement between the companies, authorize the filing of an appeal with the Board by the corporation to which no notice of a…
1Opinion of the Court
*160OPINION.
Smith :
With the invested capital question contained in the second assignment of error settled by stipulation, the only remaining issue on the merits is that of the salary deductions for the years 1918 and 1919. The respondent contends that the salary deductions taken in *161the petitioners’ returns for those years and now claimed as an expense deduction are unreasonably large an'd represent a distribution of dividends in the guise of compensation for services rendered. It same was duly authorized by the petitioners’ directors.
We do not believe that the facts which we have set out above at…
2Cited by1 opinion
- New York Talking Mach. Co. v. CommissionerUnited States Board of Tax Appeals · 1928