Geo. M. Still, Inc. v. Commissioner of Internal Revenue

In its original returns for the taxable year in suit the taxpayer failed to report cash sales in the amount of about $30,-000. The money received on these sales had been misappropriated by two of the taxpayer’s officers. Before the end of the taxable year the embezzlement was discovered by the taxpayer’s president and the embezzlers promised to make restitution, which they did in a subsequent year. The taxpayer contends that no deficiency resulted from failure to report the sales, because a deduction in the amount of the embezzlement was allowable under section 23(f) of the Internal Revenue…