Court Opinion

ID: 4490587
Source: CourtListenerOpinion
Date Created: 2020-01-17 22:02:26.696905+00
Date Added: 2024-06-11T15:02:37.619639
License: Public Domain

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 Hacine. 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 *1328therefor 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 for $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.