James A. Basye and Evelyn E. Basye v. United States

DUNIWAY, Circuit Judge:

Appellee taxpayers brought these consolidated actions in the District Court for the refund of income taxes paid for the taxable years 1960 through 1963. The District Court found in their favor, 295 F.Supp. 1289, and the government appeals. We affirm.

The case was submitted to the district court on the parties’ agreed statement of facts. Taxpayers are physicians who, during each of the tax years involved, were general partners in the Perma-nente Medical Group (Permanente), a limited partnership organized in 1949 to practice medicine in California. The Articles of…