Maggio Bros. Co. v. Commissioner
United States Tax Court
Under the facts, held, amounts withdrawn by petitioner's stockholder-employees in the taxable years and falsely charged to merchandise purchases, and checks issued to them in 1938 and 1939 charged to salaries which were not paid but were redeposited to petitioner's account, are not deductible as salaries paid; respondent did not err in disallowing deduction from 1938 income as a bad debt or as a business expense of an expenditure made in 1937; petitioner was engaged in 1940…
Read the full summary
Under the facts, held, amounts withdrawn by petitioner's stockholder-employees in the taxable years and falsely charged to merchandise purchases, and checks issued to them in 1938 and 1939 charged to salaries which were not paid but were redeposited to petitioner's account, are not deductible as salaries paid; respondent did not err in disallowing deduction from 1938 income as a bad debt or as a business expense of an expenditure made in 1937; petitioner was engaged in 1940 in a joint venture with an individual and half the profits thereof are includible in petitioner's income; and at least…
1Opinion of the Court
OPINION.
Arnold, Judge:
Petitioner concedes that the returns for all the years involved overstated the amount of merchandise purchases, but contends that the amounts of the overstatements are properly deductible on the returns as representing additional salaries of the stockholders. The petitioner’s stock was owned equally by seven individuals, six brothers and a brother-in-law. Each of the stockholders was a director and an employee of petitioner, devoted all his time to the business, and received the same salary as the other stockholders. Sam Maggio testified that in 1937 the stockholders…
2Cases cited1 opinion
- Harrington Co. v. CommissionerUnited States Tax Court · 1946
3Cited by8 opinions
- Sperapani v. CommissionerUnited States Tax Court · 1964
- Jacksonville Paper Co. v. CommissionerUnited States Tax Court · 1954
- Hall v. CommissionerUnited States Tax Court · 1976
- P. F. Scheidelman & Sons, Inc. v. CommissionerUnited States Tax Court · 1965
- Astone v. CommissionerUnited States Tax Court · 1983
3 more not listed; retrieve them via the Exa API.