Calvert Iron Works, Inc. v. Commissioner

OPINION.

Johnson, Judge:

The parties agree that commencement of business and a change of its character in 1937 meet the qualifying factors of section 722 (b) (4) and entitle petitioner to further consideration for relief.

The fact that petitioner meets the initial requirement is important only if the factor “directly results in an increase of normal earnings which is not adequately reflected by its average base period net income computed under section 713.” Wisconsin Farmer Co., 14 T. C. 1021; M. W. Zack Metal Co., 22 T. C. 349.

Petitioner is entitled to excess profits tax credits based upon…