Maine Cent. Transp. Co. v. Commissioner
United States Board of Tax Appeals
1. DEDUCTION - EXPENSE. - A railroad required its subsidiary to pay over all profits in excess of $500 from the operation of motor lines. Held, the payments were not ordinary and necessary expenses of the business of the subsidiary. 2. AFFILIATION - RAILROADS. - A company operating motor buses and trucks is not a common carrier by railroad and may not be included in a consolidated return with railroads.
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1. DEDUCTION - EXPENSE. - A railroad required its subsidiary to pay over all profits in excess of $500 from the operation of motor lines. Held, the payments were not ordinary and necessary expenses of the business of the subsidiary. 2. AFFILIATION - RAILROADS. - A company operating motor buses and trucks is not a common carrier by railroad and may not be included in a consolidated return with railroads. Sec. 141(d)(3), Revenue Act of 1934. 3. CAPITAL STOCK TAX - DECLARED VALUE. - Declared value may not be changed after time for filing an amend return has expired. William B. Scaife & Sons…
1Opinion of the Court
*354OPINION.
Muiídock :
The petitioner claims the right to a deduction equal to the amount which it paid Bailroad in each year under the contract of December 1, 1933. These payments, it says, are ordinary and necessary expenses paid during each taxable year in carrying on its business. Sec. 23 (a), Revenue Acts of 1934 and 1936. The payments were made pursuant to the contract of December 1, 1933, and the circumstances under which that contract was entered into, as well as the terms of the contract, may show whether the payments were ordinary and necessary expenses of carrying on the business of the…
2Cases cited2 opinions
- Haggar Co. v. Helvering, Com'r of Internal RevenueSupreme Court of the United States · 1940
- Traylor Engineering & Mfg. Co. v. LedererCourt of Appeals for the Third Circuit · 1921
3Cited by1 opinion
- Maine Cent. Transp. Co. v. CommissionerUnited States Board of Tax Appeals · 1940