Fraser Brick Co. v. Commissioner
United States Board of Tax Appeals
1. Evidence examined and value of tangible property paid in for capital stock determined as of September 1, 1912, for invested capital purposes. 2. Where the taxpayer, owing to a change in business conditions, discarded a dry press brick plant in 1918 and never used same thereafter, there should be deducted from the gross income for that year the difference between the depreciated cost of the plant and the salvage value thereof, if any. 3. A liability to respond in damages…
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1. Evidence examined and value of tangible property paid in for capital stock determined as of September 1, 1912, for invested capital purposes. 2. Where the taxpayer, owing to a change in business conditions, discarded a dry press brick plant in 1918 and never used same thereafter, there should be deducted from the gross income for that year the difference between the depreciated cost of the plant and the salvage value thereof, if any. 3. A liability to respond in damages for the breach of a contract occurring in the regular course of the taxpayer's business is a liability incurred at the…
1Opinion of the Court
*1255OPINION.
Milliken:
The principal issue relates to the claim for a paid-in surplus in the amount of $84,446.53. No question is involved concerning the right to the same for the years in question. We are concerned with only the amount. Respondent in his determination has allowed a paid-in surplus in the amount of $34,210.
The respondent as a basis for his action resorted to the sale in 1912 by one of the partners of a per cent interest as establishing the actual cash value of the assets acquired by petitioner at date of incorporation. Such a sale standing alone would no doubt be a sufficient index…
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