C. H. Spitzner & Son, Inc. v. Commissioner
United States Board of Tax Appeals
1. SECTION 104(b). - In determining whether accumulations are beyond the reasonable needs of a business, section 104(b), Revenue Act of 1932, sets up a practical rather than a theoretical test, and it is erroneous to compute a surplus based on cost of assets which are useful to the business only to the extent of their lower market value. 2. EVIDENCE, INTERESTED WITNESS. - Testimony of a witness that the corporation which took over the business and assets of a partnership of…
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1. SECTION 104(b). - In determining whether accumulations are beyond the reasonable needs of a business, section 104(b), Revenue Act of 1932, sets up a practical rather than a theoretical test, and it is erroneous to compute a surplus based on cost of assets which are useful to the business only to the extent of their lower market value. 2. EVIDENCE, INTERESTED WITNESS. - Testimony of a witness that the corporation which took over the business and assets of a partnership of which he was a member was formed in order to limit liability of the partners and to remove danger of liquidation of the…
1Opinion of the Court
*516OPINION.
Murdock:
Section 104 is entitled “Accumulation of Surplus to Evade Surtaxes.” The provisions of the section impose a tax of 50 percent of the net income of the corporation. That tax is in addition to the tax imposed by section 13, and the net income includes divi-*517(lends and interest oil certain obligations of the United States, which items are not normally taxed to corporations but are subject to tax in the hands of an individual owner. The following quotations are from paragraphs (a) and (b) of the section:(a) If any corporation, however created or organized, is formed or availed of…
2Cited by10 opinions
- Apollo Industries, Inc. v. CommissionerUnited States Tax Court · 1965
- Apollo Industries, Inc. v. CommissionerUnited States Tax Court · 1965
- C. H. Spitzner & Son, Inc. v. CommissionerUnited States Board of Tax Appeals · 1938
- Casey v. CommissionerUnited States Tax Court · 1957
- Chicago Stock Yards Co. v. CommissionerUnited States Board of Tax Appeals · 1940
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