Cunningham v. Commissioner

OPINION.

Mokris:

We have heretofore considered both of the questions raised by this petitioner adversely to his contentions, and we have been unable to find facts in this proceeding which would distinguish it from our previous determinations.

The credit which petitioner is seeking to apply is provided for by section 222 (a) (1) of the Revenue Act of 1921, which is as follows:

(a) That the tax computed under Part II of this title shall be credited with:

(1) In the case of a citizen of the United Slates the amount of any income, war-profits and excess-profits taxes paid during the taxable year to any foreign country or to any possession of the United States. (Italic supplied.)

The applicability of this credit was specifically considered in Appeal of Albert D. Hewinson, 1 B. T. A. 1080. In that case the petitioner was also on a cash receipts and disbursements basis, and he paid the Dominion of Canada income taxes for 1923 in April, 1924. The respondent’s action in refusing to allow this payment as a credit for 1923 was sustained by the Board. The instant case is on all fours with the Hewinson appeal except that here we have three years involved. In each year here involved the Canadian taxes were paid in the early part of the following year, and, under his method of accounting, such payments can only be a credit for the year in which paid.

The second issue has been discussed fully by the Board in Appeal of John Moir, et al., 3 B. T. A. 21, wherein we held that the credit provided for by section 1200 (a) of the Revenue Act of 1924 is to be computed after the deduction of the credit provided for in section 222 (a) (1) of the Revenue Act of 1921.

Judgment will be entered for the respondent.

Considered by Trammell, Murdock, and Siefkin.