Weinburg v. Commissioner

1 B.T.A. 178, 1924 BTA LEXIS 234

• Court: United States Board of Tax Appeals
• Decided: December 11, 1924
• Docket: Docket No. 223.
• Status: Published

Opinion

Appeal of SIDNEY WEINBURG.

Weinburg v. Commissioner

Docket No. 223.

United States Board of Tax Appeals

1 B.T.A. 178; 1924 BTA LEXIS 234;

December 11, 1924, decided Submitted November 5, 1924.

---

The New York State income tax levied upon the income of 1919 but payable and paid in 1920, is not an allowable deduction from gross income in the taxpayer's return for Federal income tax for the year 1919.

Cyrus Williams, C.P.A., for the taxpayer.

Willis D. Nance, Esq. (Nelson T. Hartson, Solicitor of Internal Revenue) for the Commissioner.

---

Before JAMES, STERNHAGEN, and TRUSSELL.

At the hearing of this appeal Mr. Cyrus Williams, acting as counsel for the taxpayer was sworn as a witness for the taxpayer, and, from the evidence given, the Board makes the following

FINDINGS OF FACT.

The taxpayer was, during the year 1919, a partner in the firm of F. A. Straus & Co. of New York, N.Y.

For the calendar year 1919 the taxpayer made an amended individual income tax return in which he showed his gross income and deductions as follows:

GROSS INCOME.
Share of partnership profits of F. A. Straus & Co		$425,011.21
Minor items of income, including interest on liberty bonds		1,072.34
Total		426,083.55
DEDUCTIONS.
Minor items of allowable deductions aggregating	$1,785.99
New York State income tax	11,554.41
Total		13,340.40
Net income, as per amended return		412,743.15

The books of the partnership of F. A. Straus & Co. were kept upon an accrual basis.

This taxpayer kept a memorandum book on the debit side of which there appears from time to time the items of moneys withdrawn from the partnership for his personal uses, together with all his income from other sources. On the credit side appear items of his personal disbursements. In this book charges were made only at times when items of income were received and payments were disbursed.

An examining revenue agent reported that this taxpayer kept his books on a cash receipts and disbursements basis and thereupon the Commissioner disallowed as a deduction from gross income in the taxpayer's individual income tax return for the year 1919 the item of New York State income tax levied upon his 1919 income paid in 1920 and claimed a deficiency in tax in the sum of $8,856.81, from which the taxpayer brings this appeal.

DECISION.

The determination of the Commissioner is approved.