Clark v. Commissioner
United States Tax Court
Where prior to the close of the taxable year 1942 the petitioner entered into an agreement with the other officers and directors of the corporation of which he was president, limiting his salary and bonus for 1941 to the amount allowed by the Commissioner as a deduction to the corporation in that year, and gave the corporation his promissory note for the difference between such amount, as tentatively agreed upon by representatives of the Commissioner and the corporation, and…
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Where prior to the close of the taxable year 1942 the petitioner entered into an agreement with the other officers and directors of the corporation of which he was president, limiting his salary and bonus for 1941 to the amount allowed by the Commissioner as a deduction to the corporation in that year, and gave the corporation his promissory note for the difference between such amount, as tentatively agreed upon by representatives of the Commissioner and the corporation, and the compensation for 1941 already paid to him in that year and 1942, held, that the petitioner is not taxable in 1942…
1Opinion of the Court
OPINION.
LeMire, Judge:
Ordinarily, a taxpayer reporting on a cash basis is taxable in each year on all of the income received in that year under a aim of right and without, restriction as to its use. North American Oil Consolidated v. Burnet, 286 U. S. 417.
However, where prior to the close of the taxable year there has been an adjustment of the contract or obligation and a repayment of a portion of the amount received, the tax liability has been determined on the basis of such adjusted amount. For instance, in Albert W. Russell, 35 B. T. A. 602, the taxpayer received during 1930 a duly…
2Cases cited2 opinions
- North American Oil Consolidated v. BurnetSupreme Court of the United States · 1932
- Commissioner v. WilcoxSupreme Court of the United States · 1946
3Cited by14 opinions
- Howard B. Quinn and Charlotte J. Quinn v. Commissioner of Internal RevenueCourt of Appeals for the Seventh Circuit · 1975
- Old Harbor Native Corp. v. CommissionerUnited States Tax Court · 1995
- Curran Realty Co. v. CommissionerUnited States Tax Court · 1950
- Jones v. CommissionerUnited States Tax Court · 1984
- Butchko v. CommissionerUnited States Tax Court · 1978
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