Eldon R. Kenseth and Susan M. Kenseth - Page 51

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              respectively attributable.”  There is no provision                        
              whatever for spreading back any related expenses as was                   
              done in petitioner’s returns.                                             
              Judge Raum saw the situation as identical with that in Smith              
         v. Commissioner, 17 T.C. at 144, quoting what the Court said in                
         that case in upholding the taxpayer’s claim of entitlement to the              
         deduction in the year of receipt, notwithstanding that the                     
         Commissioner had computed his tax liability by spreading the back              
         pay award over the years of service:                                           
              Without this section, the entire $212,000 would be                        
              income in 1945.  Section 107 is silent as to expenses                     
              incurred in connection with any collection of back pay,                   
              and there are no regulations or decisions which we have                   
              been able to find on the question.  To limit                              
              application of section 107 to amounts received less                       
              expenses connected with collection is not a function                      
              for the Court, but rather is a task for Congress if                       
              that is the result which they wish.  We therefore hold                    
              that petitioner is entitled to deduct the $25,000 legal                   
              expense in 1945.                                                          
              Judge Raum then discussed the opinions of the Tax Court and               
         the Court of Appeals for the Fifth Circuit in Cotnam v.                        
         Commissioner, supra, concluding:  “In reaching that conclusion                 
         the majority [in the Fifth Circuit] placed considerable stress                 
         upon certain provisions of an Alabama statute relating to                      
         attorney’s liens.”24  O’Brien v. Commissioner, supra at 712.                   

               24 It’s also noteworthy that the final paragraph of Judge                
          Wisdom’s dissent in Cotnam v. Commissioner, 263 F.2d 119, 127                 
          (5th Cir. 1959), revg. 28 T.C. 947 (1957), like the opinion of                
          Judge Turner in the Tax Court, and the Tax Court’s prior opinion              
          in Smith v. Commissioner, 17 T.C. 135 (1951), revd. on another                
          issue 203 F.2d 310 (2d Cir. 1953), relied upon the lack in sec.               

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