Court Opinion

ID: 4626318
Source: CourtListenerOpinion
Date Created: 2020-11-21 02:58:58.956695+00
Date Added: 2024-06-11T07:59:59.684909
License: Public Domain

APPEAL OF TWIN DISC CLUTCH CO.Twin Disc Clutch Co. v. CommissionerDocket No. 3015.United States Board of Tax Appeals2 B.T.A. 1327; 1925 BTA LEXIS 2092; November 11, 1925, Decided Submitted July 2, 1925.  1925 BTA LEXIS 2092">*2092 Wm. S. Hammers, Esq., for the taxpayer.  Lee I. Park, Esq., for the Commissioner.  2 B.T.A. 1327">*1327  Before MARQUETTE and MORRIS.  This appeal is from the determination of a deficiency in income and profits taxes for the year 1919 in the amount of $99.28.  Two questions are involved: Whether the taxpayer is entitled to deduct in 1919 depreciation on a patent application, patent for which did not issue until 1921; and whether the taxpayer is entitled to deduct the Wisconsin income tax as an accrued liability of 1919?  The appeal was submitted on a stipulation of facts.  FINDINGS OF FACT.  The taxpayer is a Wisconsin corporation, with its office located at Racine.  It was organized in September, 1918, with authorized common stock of 1,500 shares of par value of $150,000, of which 200 shares were issued for organization expenses.  On September 30, 1918, the taxpayer acquired from Thos. L. Fewick, the inventor, patent application No. 220147 and issued 2 B.T.A. 1327">*1328  therefor 400 shares of its common stock having a par value of $40,000.  The patent was issued September 13, 1921.  In October, 1919, the taxpayer's common stock to the amount of 600 shares was sold for1925 BTA LEXIS 2092">*2093  $36,325 paid in cash and $10,850 paid by interest-bearing notes.  The State of Wisconsin normal income tax shown on the 1920 tax roll, assessed on the net income of the taxpayer for 1919, amounted to $126.84.  The taxpayer paid a personal-property tax in Wisconsin during 1920 in an amount in excess of said assessment of $126.84, and the personal-property tax paid was credited against said assessment of income tax in accordance with the income-tax law of the State of Wisconsin.  DECISION.  The determination of the Commissioner is approved.