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Year Amount
1975 $58,512
1976 62,302
1977 45,061
1978 36,734
1979 36,846
1980 44,725
Total $284,180
On her returns for those years, decedent deducted an allowance
for depletion in an amount which was 22 percent of the gross
royalties reported.
Petitioner filed a Federal income tax return for the taxable
year 1992 on which it reported and paid a tax of $8,338. This
1992 tax was computed without taking a deduction for any portion
of the amount paid to Exxon in 1992.
Section 1341 provides relief to taxpayers who are forced to
repay an item previously reported as income under a claim of
right. Both parties agree that for purposes of section 1341,
petitioner and decedent should be treated as one and that
petitioner is entitled to section 1341 relief. Both parties also
agree that relief should be in the form of a credit computed
pursuant to section 1341(a)(5) and (b).
The pertinent provisions of section 1341 provide as follows:
SEC. 1341. COMPUTATION OF TAX WHERE TAXPAYER RESTORES
SUBSTANTIAL AMOUNT HELD UNDER CLAIM OF
RIGHT.
(a) General Rule.--If--
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