- 7 -
Co., 348 U.S. 426, 431 (1955), “without * * * an obligation to
repay, and without restriction as to their disposition”, James v.
United States, 366 U.S. 213, 219 (1961); see also N. Am. Oil
Consol. Co. v. Burnet, 286 U.S. 417, 424 (1932).
In Crary v. Commissioner, T.C. Memo. 1970-40, after
receiving a paycheck from his employer, the taxpayer on the same
day wrote a check to his employer for the same amount and did not
include the paycheck in his income. We held that the taxpayer
was not permitted to exclude the paycheck from his income. Id.
In Jones v. Commissioner, 82 T.C. 586, 588-590 (1984), a
taxpayer relinquished his rights to a profit-sharing plan and
withdrew funds from the plan, but then gave the funds back to his
employer. We held that the unconditional receipt of the funds
resulted in taxable income in the year of receipt. Id. at 590-
592.
Respondent argues primarily that because petitioner was not
obligated by any agreement to return to the firm the $129,000 in
independent contractor fees, the $129,000 constituted income to
petitioner when received, and no justification exists for
excluding the $129,000 from petitioner’s income.
Petitioners, citing Gregory v. Helvering, 293 U.S. 465, 469
(1935), argue that taxpayers are entitled to structure
transactions to pay the least Federal income tax (namely, to
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 Next
Last modified: May 25, 2011