Feuer v. Commissioner

Appeal of MORRIS FEUER.

Feuer v. Commissioner

Docket No. 444.

United States Board of Tax Appeals

1 B.T.A. 1113; 1925 BTA LEXIS 2660;

May 6, 1925, decided Submitted March 30, 1925.

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David A. Ticktin, Esq., for the taxpayer.

Laurence Graves and James T. Dortch, Esqs., for the Commissioner.

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Before JAMES, STERNHAGEN, and TRUSSELL.

This appeal involves a deficiency in income taxes for the years 1919, 1920, and 1921, in the amount of $616,481.50, as set forth in the Commissioner's deficiency letter of August 28, 1924.

FINDINGS OF FACT.

The taxpayer during the years in question was engaged in the saloon and restaurant business in the City of New York. He carried during this period a considerable cash balance in the bank and made a regular practice of cashing pay-roll checks for firms and other individuals engaged in the manufacture of cloaks and suits and women's and children's dresses in the vicinity of his place of business. The taxpayer dept books of account, but, when visited by examining revenue agents, these books had either been lost or destroyed by fire or were otherwise not available to the examiners. Under these circumstances, the examiners determined his total bank deposits for the period in question, deducted therefrom the expenses of his business so nearly as they could be determined, and recommended the assessment of the additional tax here in question on the basis of the net income shown by the difference between the bank deposits above mentioned and the expenses so estimated.

The taxpayer's bank account was throughout the period in question used for the most part to clear checks for others, and only a small portion of his total deposits represented gross income from his business or otherwise accrued to him personally.

Counsel for the Commissioner and the taxpayer by agreement have stipulated the taxpayer's correct deficiency for the years in question, which is for the year 1919, $156.10, for the year 1921, $210.04, and have stipulated for the year 1920 there is an overassessment of $37.06.

DECISION.

In accordance with the stipulation, the deficiency originally determined by the Commissioner is allowed in part and disallowed in part and the taxpayer's total deficiency for the years 1919, 1920, and 1921, is determined to be $329.08.