Eastern Bldg. Corp. v. Commissioner ( 1929 )

EASTERN BUILDING CORPORATION, PETITIONER, v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT.

Eastern Bldg. Corp. v. Commissioner

Docket No. 20746.

United States Board of Tax Appeals

16 B.T.A. 138; 1929 BTA LEXIS 2637;

April 23, 1929, Promulgated

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In determining whether net income is in excess of $25,000 and whether the credit of $2,000 is to be allowed, the net loss provided for in section 204(b) may not be deducted. American Varnish Co.,2 B.T.A. 201">2 B.T.A. 201.

O. J. Tall, Esq., for the respondent.

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MURDOCK

OPINION.

MURDOCK:

The petitioner is a corporation organized and existing under the laws of the State of New York, with its principal office at New York City. In this proceeding it seeks a redetermination of its income-tax liability for the year 1923, for which year the Commissioner determined a deficiency of $1,290.91. The petitioner's only contention is that its net income was less than $25,000 and therefore it was entitled to a credit of $2,000 under section 236(b) of the Revenue Act of 1921. From the statement attached to the Commissioner's deficiency notice it appears that for the year 1923 the petitioner was entitled to deduct from its income $11,219.13 representing part of a net loss for the year 1921, and if its net income for the purpose of section 236(b) should be determined by first deducting this portion of the net loss, then its net income was less than $25,000, but if the portion of the net loss should not be deducted in determining the net income for the purpose of 236(b), then its net income exceeded $25,000. We have heretofore considered this question fully and have held that the net income for the purpose of determining whether or not the taxpayer is entitled to the credit provided by 236(b) should not be reduced by the net loss. ; ; ; . We are of the same opinion still.

Judgment will be entered for the respondent.