For Your Data Improve V. Commissioner Example Brief
October 29, 2020
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Amend v. Commissioner representative brief summary
13 T.C. 178; 1949 U.S.A. Tax Ct. LEXIS 113
SYNOPSIS:
Petitioner wheat farmer sought review of the determination of respondent Commissioner of Internal Revenue (commissioner), which determined deficiencies inwards the farmer's revenue enhancement supply based on the doctrine of constructive receipt, equally defined inwards Treas. Reg. § 29.42-2.
OVERVIEW: The farmer entered into a contract to sell his wheat to a purchaser inwards August 1944, simply was non paid until Jan 1945. The farmer used the cash dry reason method of accounting together with paid revenue enhancement on the payment from the purchaser equally purpose of his gross income inwards 1945, the twelvemonth that he truly received it. The commissioner determined that the farmer had the unqualified correct to have his coin for the wheat inwards 1944; that all he had to exercise to have his coin was to inquire for it; together with that, therefore, the doctrine of constructive receipt applied.
HOLDING:
The courtroom held that the contract betwixt the farmer together with the purchaser was a bona fide arm's-length transaction together with that the farmer did non accept the correct to involve the coin for his wheat until Jan 1945; so the doctrine of constructive receipt did non apply.
ANALYSIS:
The farmer returned equally a purpose of his gross income the checks which he truly received inwards payment for his wheat together with complied amongst the income revenue enhancement laws governing a taxpayer who keeps his accounts together with makes his returns on the cash basis.
OUTCOME: The courtroom establish that the commissioner erred inwards applying the doctrine of constructive receipt to the payment which the farmer received for his wheat inwards 1945.
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