Nassau Suffolk Lumber & Supply Corp. v. Commissioner
United States Tax Court
In an agreement for the sale of a fuel business, the purchaser agreed to make installment payments amounting to $ 23,787.50 and to pay an annual "license royalty" for 99 years, the amount of each royalty to be determined by the annual sales volume of the fuel business, but in no event would the royalty be less than $ 7,500 per annum. Held: In the circumstances of this case, the seller retained a continuing interest in the fuel business.
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In an agreement for the sale of a fuel business, the purchaser agreed to make installment payments amounting to $ 23,787.50 and to pay an annual "license royalty" for 99 years, the amount of each royalty to be determined by the annual sales volume of the fuel business, but in no event would the royalty be less than $ 7,500 per annum. Held: In the circumstances of this case, the seller retained a continuing interest in the fuel business. The "royalty" payments are deductible by the purchaser or his assignee-subchapter S corporation as ordinary and necessary business expenses and represent…
1Opinion of the Court
Nassau Suffolk Lumber & Supply Corporation, et al., 1 Petitioners v. Commissioner of Internal Revenue, Respondent
Nassau Suffolk Lumber & Supply Corp. v. Commissioner
Docket Nos. 3680-67, 3727-67, 1878-68, 3961-68
United States Tax Court
53 T.C. 280; 1969 U.S. Tax Ct. LEXIS 20;
November 24, 1969, Filed
Decisions will be entered under Rule 50.
In an agreement for the sale of a fuel business, the purchaser agreed to make installment payments amounting to $ 23,787.50 and to pay an annual "license royalty" for 99 years, the amount of each royalty to be determined by the annual sales volume of the fuel…
2Cases cited12 opinions
- Michaels v. CommissionerUnited States Tax Court · 1949
- Toledo Newspaper Co. v. CommissionerUnited States Tax Court · 1943
- James H. Pickren and Lucie B. Pickren v. United StatesCourt of Appeals for the Fifth Circuit · 1967
- Olin Bryant and Vanell Bryant v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1968
- Vermont Transit Co. v. CommissionerUnited States Tax Court · 1953
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