Malbin v. Commissioner

1954 T.C. Memo. 121, 13 T.C.M. 773, 1954 Tax Ct. Memo LEXIS 125
CourtUnited States Tax Court
DecidedAugust 12, 1954
DocketDocket Nos. 36952, 47208.
StatusUnpublished

This text of 1954 T.C. Memo. 121 (Malbin v. Commissioner) is published on Counsel Stack Legal Research, covering United States Tax Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Malbin v. Commissioner, 1954 T.C. Memo. 121, 13 T.C.M. 773, 1954 Tax Ct. Memo LEXIS 125 (tax 1954).

Opinion

Irving Malbin and Dorothy Malbin v. Commissioner. Irving Malbin v. Commissioner.
Malbin v. Commissioner
Docket Nos. 36952, 47208.
United States Tax Court
T.C. Memo 1954-121; 1954 Tax Ct. Memo LEXIS 125; 13 T.C.M. (CCH) 773; T.C.M. (RIA) 54227;
August 12, 1954, Filed

*125 Petitioner was in the wholesale meat business during the tax years 1943 through 1946. His books and records admittedly did not accurately reflect his business income for those years and he failed to at any time produce the books maintained for 1943 and 1946. Held:

1. Petitioner's net income and tax deficiencies for 1943 through 1946 determined by adjusting certain items as reported in his returns.

2. Petitioner's deficiencies for 1944 and 1945 were due in part to fraud with intent to evade taxes. The deficiency for 1946 is not due to fraud with intent to evade tax. Fraud was not alleged for 1943.

3. Petitioner is liable for section 294(d)(2) penalties resulting from substantial underestimation of estimated tax in 1944, 1945, and 1946.

Leo Sussman, Esq., 320 Broadway, New York, N. Y., for the petitioners. Arthur L. Nims, Esq., for the respondent.

BLACK

Memorandum Findings of Fact and Opinion

The Commissioner, in Docket No. 36952, has determined a deficiency of $6,018.13 in the 1943 income and victory taxes of Irving and Dorothy Malbin. The statement accompanying the deficiency notice explains that the deficiency stems from an increase in reported business net income resulting "from purchases of $15,000.00 disallowed for lack of substantiation and disallowance of depreciation of $125.00 taken on a fully depreciated asset."

In Docket No. 47208, the Commissioner has determined the following*127 deficiencies and penalties in Irving Malbin's income taxes for 1944, 1945 and 1946:

50%6% Esti-
Fraudmated Tax
PenaltyPenalty
(Sec.(Sec.
YearDeficiency293(b))294(d)(2))
1944$ 82,597.37$41,298.68$4,905.54
1945128,749.3564,374.687,861.08
194633,043.8716,521.932,193.66
The statement accompanying the deficiency notice explains that the deficiencies result from the following adjustments in reported business net income:
194419451946
Sales omitted$ 15,500.00$ 3,796.51
Unaccounted for cash deposits45,854.7365,673.51
Unsubstantiated purchases disallowed22,157.6381,943.24$35,000.00
Mark-up of 25% on purchases not recorded on books
and allowed as a deduction below113,947.21
Unsubstantiated entertainment expenses disallowed2,500.00
Obsolescence - tire equipment disallowed2,959.77
Unsubstantiated petty cash expenses disallowed1,419.69
Unsubstantiated professional fees disallowed3,115.05
Unsubstantiated commissions paid disallowed4,579.23
Unexplained cash deposit3,900.00
Total$197,459.57$153,913.26$50,973.74

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1954 T.C. Memo. 121, 13 T.C.M. 773, 1954 Tax Ct. Memo LEXIS 125, Counsel Stack Legal Research, https://law.counselstack.com/opinion/malbin-v-commissioner-tax-1954.