Royal Packing Co. v. Commissioner

5 B.T.A. 55, 1926 BTA LEXIS 1988

Opinion

OPINION.

Lansdon :

The law under which the petitioner claims is as follows:

Sec. 234. (a) That in computing the net income of a corporation subject to the tax imposed by section 230 there shall be allowed as deductions:

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(4) Losses sustained during the taxable year and not compensated for by insurance or otherwise. (Revenue Act of 1918.)

To prevail in its contention the petitioner must prove that the loss was sustained in the taxable year. The evidence is clear that the Universal Packing Co. became insolvent and ceased to function prior to November 1, 1918, a date within the taxable year. It is also in evidence that the insolvent corporation owned certain assets and that the sale of such assets and the final liquidation of its business were not completed within the fiscal year ended January 31, 1919. There is no convincing evidence that any loss was sustained in the taxable year.

Judgment will be entered for the Commissioner.