United States v. George R. Dempster and Frances S. Dempster

This is an appeal from a judgment of the District Court for the Eastern-District of Tennessee, Northern Division, granting taxpayers’ claims for refund of 1951 and 1952 federal income-taxes. In these years the taxpayer husband received certain sums as part con sideration for the transfer of all his rights in certain patents. On returns filed for each of those years, taxpayers reported the royalties so received as ordinary income and paid the tax due on that basis.

On September 11, 1956, taxpayers filed claims for refund for the years involved alleging overpayments of tax for those years by…