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Although the majority would allow most of ACC’s salary
expenses in issue to be currently deductible, I would go further
and hold all of such salaries to be currently deductible.
I also am puzzled by the majority's different treatment of
salaries and overhead expenses. I believe that on the particular
facts of this case both salaries and overhead expenses should
receive consistent treatment and, as indicated, be fully
deductible.
The concluding comments made by the Court of Appeals for the
Third Circuit in PNC Bancorp, Inc. v. Commissioner, 212 F.3d at
835, reflect much of my thinking on the issue before us. I quote
a portion thereof:
we find the case before us today to be much farther
from the heartland of the traditional capital
expenditure (a “permanent improvement or betterment”)
than are the scenarios at issue in INDOPCO and Lincoln
Savings. We will not mechanistically apply phrases
from those precedents in ignorance of the realities of
the facts before us. We see no principled distinction
between the costs at issue here and other costs
incurred as “ordinary expenses” by banks. [Id.]
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