Brooklyn Radio Service Corp. v. Commissioner
United States Board of Tax Appeals
A corporation agreed to pay its president a salary measured by a percentage of its net sales for the taxable year, with the understanding that the amount would not be paid as long as the corporation was indebted to finance companies on account of its own insufficiency of working capital or to any banks, and in no event until after the taxable year, and with the further understanding that the amount due would be subordinated by him to the indebtedness of all other creditors…
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A corporation agreed to pay its president a salary measured by a percentage of its net sales for the taxable year, with the understanding that the amount would not be paid as long as the corporation was indebted to finance companies on account of its own insufficiency of working capital or to any banks, and in no event until after the taxable year, and with the further understanding that the amount due would be subordinated by him to the indebtedness of all other creditors of the corporation. Held, while the time of payment was uncertain, the obligation to pay the salary (there having been…
1Dissent
Black,
dissenting: The amount of 2 percent commission on annual sales to the president of the corporation, allowed as a deduction of accrued expense to the corporation by the majority opinion, was not payable by the corporation, (1) as long as the corporation was indebted to finance companies on account of its own insufficiency of working capital, (2) as long as the corporation was indebted to any bank. And with the further understanding that “ said 2% of the net sales to be due to Benjamin Ginsberg be subordinated by him to the indebtedness to all other creditors of this corporation.” This…
2Cases cited7 opinions
- Brown v. HelveringSupreme Court of the United States · 1934
- Tebo v. . RobinsonNew York Court of Appeals · 1885
- Wakeman v. . ShermanNew York Court of Appeals · 1853
- Rannels v. RoweCourt of Appeals for the Eighth Circuit · 1906
- Ketchum v. BeldingAppellate Division of the Supreme Court of the State of New York · 1901
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