Swed Distributing Company v. Commissioner of Internal Revenue

WISDOM, Circuit Judge.

This case, now before us for the second time, presents the question whether the taxpayer, Swed Distributing Company, a Florida corporation, is entitled to deduct as ordinary and necessary business expenses certain payments made to Swed and Sullivan, a partnership composed of the taxpayer’s two stockholders. The nature of the case requires close scrutiny of the record.

Louis Swed and John L. Sullivan formed a partnership to go into the beer distributing business in Florida on December 30, 1944. Through one George 0. Hinzpeter, the partnership was able to obtain a Florida…