Don E. Williams Co. v. Commissioner
United States Tax Court
Petitioner contributed to its profit-sharing plan for 3 taxable years by issuing its demand, interest-bearing, promissory notes secured by pledges of its principal shareholders. Petitioner paid the notes in each of the succeeding years. Held, the promissory notes do not constitute "payment" required by sec. 404(a), I.R.C. 1954, and petitioner's deductions for the contributions are denied. Logan Engineering Co., 12 T.C. 860 (1949), followed.
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Petitioner contributed to its profit-sharing plan for 3 taxable years by issuing its demand, interest-bearing, promissory notes secured by pledges of its principal shareholders. Petitioner paid the notes in each of the succeeding years. Held, the promissory notes do not constitute "payment" required by sec. 404(a), I.R.C. 1954, and petitioner's deductions for the contributions are denied. Logan Engineering Co., 12 T.C. 860 (1949), followed. Sachs v. Commissioner, 208 F. 2d 313 (C.A. 3, 1953); Time Oil Co. v. Commissioner, 258 F. 2d 237 (C.A. 9, 1958); Wasatch Chemical Co. v. Commissioner, 313…
1Opinion of the Court
OPINION
Goufe, Judge:
The Commissioner determined deficiencies in petitioner’s income tax for the taxable years ended April 30,1967, April 30, 1968, and April 30, 1969, in the amounts of $15,162.87, $1,360.64, and $530.42, respectively. The sole issue for decision is whether petitioner’s promissory notes issued and delivered to the trustees of the trust for its profit-sharing plan constitute “payment” as required by section 404(a) of the Internal Revenue Code of 19541 thus entitling petitioner to deductions for the face amounts of the notes in the taxable years the notes were issued.
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2Cases cited13 opinions
- Sioux Tribe of Indians v. United StatesSupreme Court of the United States · 1942
- Fountain v. CommissionerUnited States Tax Court · 1973
- Time Oil Company v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1958
- Anthony P. Miller, Inc. v. Commissioner of Int. Rev.Court of Appeals for the Third Circuit · 1947
- PG Lake, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1945
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3Cited by19 opinions
- Don E. Williams Co. v. CommissionerSupreme Court of the United States · 1977
- Jackson v. CommissionerUnited States Tax Court · 1986
- Don E. Williams Company v. Commissioner of Internal RevenueCourt of Appeals for the Seventh Circuit · 1975
- Solomon v. CommissionerUnited States Tax Court · 1976
- Guren v. CommissionerUnited States Tax Court · 1976
14 more not listed; retrieve them via the Exa API.