Court Opinion

ID: 9460605
Source: CourtListenerOpinion
Date Created: 2023-08-04 21:55:22.413862+00
Date Added: 2024-06-11T17:36:42.135486
License: Public Domain

SIMPSON, Circuit Judge
(dissenting) :
I view as controlling here our decision in B & L Farms Co. v. United States, 5 Cir. 1967, 368 F.2d 571, cert. denied 1967, 389 U.S. 835, 88 S.Ct. 45, 19 L.Ed.2d 96, affirming per curiam (Judge, now B & L Farms Co. v. United States, S.D. Chief Judge, Brown dissenting in part) Fla.1964, 238 F.Supp. 407.
The majority opinion seeks to distinguish B & L Farms because that case merely holds that turning over assets does not constitute payment during the taxable year in question, whereas the majority decision here is to allow credit for amounts actually expended by the trustee in later years.
Our opinion in B & L Farms adopted the district court opinion and its reasoning: “The conclusions reached by the district court are correct and its judgment is free from error. That judgment is affirmed.” When we go back to the district court opinion in B •& L Farms we find that that court did not limit itself to the fact of wholesale deduction. Instead it expressly held that payments by a trustee in later years cannot be deducted as “paid” in the taxable year under Section 162 of the Internal Revenue Code, regardless of whether the amounts are ascertainable then, later, or anytime. 238 F.Supp. at pp. 409-410. The majority’s attempt to distinguish the two cases will not withstand critical analysis. The carry-over aspect of B & L Farms absent in the instant case, relied on as a distinguishing factor by the majority opinion is quite simply irrelevant. It came into play only after decision of the issue identical to the two cases, the disallowance of a deduction for expenses paid by the trustee after the year of adjudication of bankruptcy.
Agreed that B & L Farms produces a harsh result, it governs our decision of this case in my view. I would affirm the tax court per curiam on the authority of B & L Farms.
I respectfully dissent.