M. B. Austin Co. v. Commissioner

Board of Tax Appeals

M. B. Austin Co. v. Commissioner

13 B.T.A. 867, 1928 BTA LEXIS 3174

CourtUnited States Board of Tax Appeals

DecidedOctober 9, 1928

DocketDocket No. 14883.

StatusPublished

Cited by1 cases

This text of 13 B.T.A. 867 (M. B. Austin Co. v. Commissioner) is published on Counsel Stack Legal Research, covering United States Board of Tax Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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M. B. Austin Co. v. Commissioner, 13 B.T.A. 867, 1928 BTA LEXIS 3174 (bta 1928).

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Opinion

[870]*870OPINION.

GREen:

The principal question in this proceeding is whether the majority stockholder of the petitioner continued to operate as a partnership after the petitioner was organized. The evidence is uncontradicted that they did. Both Austin and Browne testified that the only purpose of forming the corporation was to take over that part of the business which required the use of capital and that at no time did the corporation acquire the sales agency commission contracts. They further testified that the partnership in question had existed from the year 1898 and was still in existence during 1919. The agreement of copartnership executed on December 1, 1919, corroborates such testimony. The respondent was, therefore, in error in consolidating the net income of the partnership and corporation into one return. The deficiency should be redetermined by excluding from the net income of $91,881.15, determined by the respondent, the amount of $46,896.45.

In view of the foregoing it does not become necessary to consider the two alternatives.

Judgment will be entered under Rule 50.

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[870]*870OPINION.

GREen:

The principal question in this proceeding is whether the majority stockholder of the petitioner continued to operate as a partnership after the petitioner was organized. The evidence is uncontradicted that they did. Both Austin and Browne testified that the only purpose of forming the corporation was to take over that part of the business which required the use of capital and that at no time did the corporation acquire the sales agency commission contracts. They further testified that the partnership in question had existed from the year 1898 and was still in existence during 1919. The agreement of copartnership executed on December 1, 1919, corroborates such testimony. The respondent was, therefore, in error in consolidating the net income of the partnership and corporation into one return. The deficiency should be redetermined by excluding from the net income of $91,881.15, determined by the respondent, the amount of $46,896.45.

In view of the foregoing it does not become necessary to consider the two alternatives.

Judgment will be entered under Rule 50.

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13 B.T.A. 867, 1928 BTA LEXIS 3174, Counsel Stack Legal Research, https://law.counselstack.com/opinion/m-b-austin-co-v-commissioner-bta-1928.

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