Law Commons^™

Taxation-Collection And Enforcement-Action Against Collector Of Internal Revenue Not The Proper Method Of Removing Federal Tax Liens, John Houck S.Ed.

Michigan Law Review

Plaintiff's property was under a federal tax lien. He brought suit in the district court against the Collector of Internal Revenue, alleging fraudulent issuance of the lien and seeking removal and damages occasioned by the cloud on his title. The collector moved to dismiss on the grounds that no claim was stated upon which relief could be granted, and further, that the collector was not the proper party defendant, while the United States, which had not been joined, was indispensable to the proceeding. Held, petition dismissed. The court found no indication of fraud, but even assuming fraud to exist, …

Congress Or The Courts As Final Arbiter In Tax Disputes?, William J. Bowe

Vanderbilt Law Review

During the last two years the Supreme Court of the United States has handed down only five income tax opinions. The box score stands four for the Government, one for the taxpayer. None of the cases involved modifications in fundamental concepts of tax law or resulted in major policy changes in the administration of the fiscal system. The record for the taxpayer is far more impressive in the Congress than it is in the courts. As will be pointed out later Congress rather than the Supreme Court is tending to become the final arbiter in tax disputes. Problems that were …

Title Examinations In Michigan As Affected By The General Federal Tax Lien, L. Hart Wright

Michigan Law Review

There are three federal tax liens which serve to haunt the average title examiner. The first of these is pitched at the wholesale level; it is a shotgun type lien applicable to all federal taxes and is now provided for by section 3670 of the Internal Revenue Code. The second and third are not nearly so sweeping. One is confined to the federal estate tax, being provided for by section 827 of the code, while the other reinforces the federal gift tax and is the product of section 1009 of the code.

The discussion which follows deals only with the …

Apportionment Of The Federal State Tax In The Absence Of Statute Or An Expression Of Intention, William P. Sutter

Michigan Law Review

Federal law now provides in sections 826 (c) and (d) of the Internal Revenue Code that life insurance and property transferred by appointment shall bear their proportionate tax burden. It does not contain similar provisions with respect to other types of non-probate property. At the present time, twenty states provide by statute for some sort of apportionment of estate taxes. Two states have statutes restricting apportionment in some degree. In the rest, the matter rests in the discretion of the courts. I propose to discuss in this article the situation in those areas where no statutory guidance exists.

Taxation-Federal Income Tax-Payments Under Written Agreement Incident To Divorce, David W. Rowlinson S. Ed.

Michigan Law Review

Petitioner and her husband separated in January 1919 after marital difficulties. The following sequence of events transpired in the next four months: the husband employed detectives to follow his wife and discover evidence on which a divorce action could be predicated; petitioner instituted proceedings for legal separation; a separation agreement was executed under which the husband was to give petitioner an initial payment of $200,000 and subsequent annual payments of $30,000 for her life; the husband began a suit for divorce to which petitioner counterclaimed for a divorce; a divorce was decreed in favor of petitioner. Petitioner did not ask …

Death And Taxes-Code Section 126 And The Developing Taxable Income Concept

Indiana Law Journal

No abstract provided.

Tax Planning For Nontaxable Estates, William J. Bowe

Vanderbilt Law Review

Owners of modest estates are always greatly relieved to learn of the liberal federal estate tax exemption of $60,000. Freed from the burden of federal estate tax planning they frequently turn their attention to methods of transferring property which will avoid the heavy cost and delay incident to probate administration. Joint ownership, gifts of remainder interests, donee-beneficiary contracts, revocable trusts are among the more common devices available. Use of any one of these plans may accomplish a shift in possession and enjoyment of property upon the death of the planner with no delay and minimum expense.

But the income tax …

Recent Cases, Law Review Staff

Vanderbilt Law Review

Recent Cases

Adverse Possession--Statutes--May One Acquire an Indefeasible Life Estate under Tennessee Code Section 8582

Constitutional Law--Freedom of the Press--Effect of City Ordinance Prohibiting Solicitation of Magazine Subscriptions without Prior Consent of Person Solicited

Constitutional Law--Statutes--Requirement of Loyalty Oath as Valid Exercise of Police Power

Contracts--Procurement of Government Contracts on Contingent Fee Basis--Effect of Executive Order

Criminal Law--Mens Rea--Requirement in Action for Converting Government Property--Necessity for Criminal Intent

Damages--Injury to Child--Expenses of Parent in Attending Child

Divorce--Determination of Place Where Abandonment Occurs--Effect of Residence Requirement for Bringing Action

Domestic Relations--Legitimation Statute--Interpretation and Effect

Evidence--Unreasonable Searches and Seizures--Admissibility of Evidence Obtained …

Taxation--Liability Of Purchaser At Tax Sale For Assessments On Property, S. F. B.

West Virginia Law Review

No abstract provided.

Taxation-Federal Income Tax-Gain On Sale Of Livestock, David F. Ulmer S.Ed.

Michigan Law Review

Taxpayer was engaged in the business of raising and breeding beef cattle. Each year he would add to the breeding herd the young females raised the previous year and would cull from the herd those older cows who had outlived their most productive years and such young heifers as had proved unproductive. These culls were sold on the market, and taxpayer returned the amounts received from these sales as capital asset gain. The Commissioner assessed a deficiency claiming the sales resulted in ordinary income. Held, the sale of culls from a breeding herd is treated as a sale of …

Conflict Of Laws - Negotiable Instruments - Situs Of Bearer Bonds Under The Trading With The Enemy Act, W. H. Bates S.Ed.

Michigan Law Review

ln a suit on a negotiable instrument, a problem arises as to just how many places can claim valid jurisdiction. Thus, where the domiciles of the parties to a negotiable instrument are diverse, there are several jurisdictional possibilities. For example, with regard to a negotiable bearer bond it may be said that there is sufficient contact with the parties and/or the property (1) at the place where it was issued, (2) at the present location of the certificate of indebtedness, (3) at the location of the debtor corporation's office or principal place of business, or (4) in the state of …

Patent Royalties As Capital Gains Under I.R.C., Section 117(A), Ruth E. Riddell

Michigan Law Review

With the incidence of high personal surtax rates, a patentee is ordinarily interested in deriving the greatest monetary return after taxes, measured in proportion to the extent of use over what he expects to be the increasingly productive life of the intangible right evidenced by his patent, without surrendering his option to reclaim the patent in event of insolvency or lack of diligence on the part of the person to whom he transfers the patent for exploitation. Although ideal for these purposes, the favorable capital gain status under section 117(a) of the Internal Revenue Code, requiring recognition of only fifty …

Taxation-Federal Income Tax-Deductibility Of Contributions To Profit-Sharing Trusts, W. H. Bates S.Ed.

Michigan Law Review

Plaintiff corporation set up a profit sharing trust for the benefit of its employees as authorized under section 165(a) of the Internal Revenue Code. The plan for the trust, as approved by the Treasury, provided that plaintiff should contribute annually an amount equal to 15 % of net income, as defined, not to exceed 15% of basic salary or wages of all eligible participating employees. For the tax year 1944 plaintiff claimed deductions under section 23(p)(1)(C) for an amount equal to 15% of the total participating payroll, which is actually the allowable maximum, but which in this case exceeded 15% …

Recent Cases, Law Review Staff

Vanderbilt Law Review

CONSTITUTIONAL LAW--RACIAL RESTRICTIVE COVENANTS--ALLOWANCE OF DAMAGES FOR BREACH

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CORPORATIONS--PARENT AND SUBSIDIARY--SUBSIDIARY AS INSTRUMENTALITY OF PARENT WHEN USED TO CARRY ON UNFAIR TRADE PRACTICES

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EVIDENCE--ADMISSIBILITY OF CONFESSION--SCOPE OF REVIEW OF COURT-MARTIAL BY COURT OF MILITARY APPEALS

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EVIDENCE--CONFLICT OF LAWS--APPLICATION OF DOCTRINE OF RES IPSA LOQUITUR

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EVIDENCE--DUE PROCESS--USE IN STATE PROSECUTION OF EVIDENCE FORCIBLY OBTAINED BY STOMACH PUMP

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EVIDENCE--ENTRIES IN THE REGULAR COURSE OF BUSINESS--TEST FOR EXTENT OF ADMISSIBILITY UNDER FEDERAL JUDICIAL CODE

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EVIDENCE--HEARSAY--ADOPTION OF LIBERAL ADMISSION RULES OF ADMINISTRATIVE TRIBUNALS IN ANTITRUST COURT ACTION

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EVIDENCE--IMPEACHMENT OF ONE'S OWN WITNESS--USE OF PRIOR INCONSISTENT STATEMENTS

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Equity: The Clean Hands Maxim And The New Federal Gambler’S Tax, Robert Alan Thompson

Buffalo Law Review

Combs v. Snyder, 101 F. Supp. 531 (D. C. 1951), aff'd. without opinion, 20 U. S. L. Week 3224 (U. S. Feb. 19, 1952).

Tax Conventions Relating To Individuals And Corporations Abroad, Norman E. Bloom

Buffalo Law Review

No abstract provided.

Taxation-Federal Income Tax-Sale Of Goodwill Treated As Sale Of A Capital Asset, David F. Ulmer S.Ed.

Michigan Law Review

Plaintiffs were partners in a wholesale produce business which was well established and had a large goodwill value in the area. Plaintiffs sold the whole business, including goodwill, to another produce dealer, with a specific portion of the sale price being allocated to the sale of the goodwill. Included in the sale contract was an agreement by the sellers not to compete with the purchaser for a certain number of years, but it was understood by the parties that none of the sale price was given in consideration of this agreement. Plaintiffs returned the amount received from the sale of …

Taxation-Federal Income Tax-Exempt Corporations-Statutory Interpretation, Patrick J. Ledwidge

Michigan Law Review

Plaintiff corporation was organized in 1947 by physicians who had formerly maintained a clinic for the practice of medicine as a partnership. The articles of incorporation provided that there should be no capital stock and no dividends, and stated that plaintiff was organized as a non-profit corporation for the purpose of providing medical treatment and hospitalization to sick and injured persons without regard to ability to pay therefor, and of providing such other incidental charitable services as the "trustees" of the corporation should prescribe. Pursuant to its by-laws, plaintiff paid such annual salaries to its member physicians as the trustees, …

Taxation-Federal Income Tax-Period For Deduction Of Embezzlement Losses, Thomas P. Segerson S.Ed.

Michigan Law Review

This action was brought against the United States for a refund of income taxes paid. Plaintiff taxpayer claimed she was entitled to a deduction in 1941 for losses resulting from the embezzlement of funds by a trustee which were discovered in that year. The Commissioner of Internal Revenue disallowed the claimed deduction because the acts constituting the embezzlement had taken place during prior years. Held, judgment for defendant. Embezzlement losses are deductible in the years in which the defalcations take place, not in the years such defalcations are discovered. Alison v. United States, (D.C. Pa. 1951) 97 F. …

Taxing Distributions Pursuant To Corporate Reorganizations, William M. Emery

Michigan Law Review

"Distributions" implies that we are concerned with the tax problems of the stockholder rather than those of the corporation. And while one corporation may be the stockholder of another, my emphasis will be primarily upon stockholders who are individuals, including, of course, trusts and estates who are taxed as individuals.

Constitutional Law-Due Process-Freedom Of Expression- Commerce Clause-Clause-"Green River" Ordinance As Applied To Door To Door Solicitation For Magazine Subscriptions, C. E. Lombardi, Jr. S.Ed.

Michigan Law Review

In their famous article on the right of privacy, Warren and Brandeis noted that the common law protection of the right of privacy in the home was far more highly developed than the protection given to individual privacy in other respects. "The common law has always recognized a man's house as his castle, impregnable, often, even to its own officers engaged in the execution of its commands." The common law impregnability has met perhaps its stiffest test when those attacking it have sought constitutional protection. The recent decision of the Supreme Court in the case of Breard v. City of …

Some Latter Day Developments In The Taxation Of Liquidating Distributions: Is The Cop Still On The Beat?, Willard H. Pedrick

Michigan Law Review

Redemption and salvation are doctrinal terms suggestive of the enthusiasm of the camp meeting. It is altogether fitting that these terms be used in connection with the taxation of corporate liquidating distributions. Through redemption of his stock the shareholder may find this world's nearest approach to fiscal salvation-taxation of his receipts on a capital-gains basis. To say the shareholder's enthusiasm for capital-gains treatment approaches a religious zeal is to underestimate the matter. Nor is it difficult to understand his attitude. If corporate earnings and profits, subjected at the outset to a relatively Hat but heavy corporate income tax, are paid …

Modification Of Domiciliary State's Power To Tax Vessels Engaged In Interstate Commerce, Sam W. Baker

Cleveland State Law Review

Standard Oil Co. v. Peck, Tax Commissioner et al., 72 S. Ct. 309 (1952) Held: The ad valorem taxes levied by various states must be fairly apportioned to the commerce carried on within the taxing state. The rule permitting taxation of personal property used in interstate operations by two or more states on an apportionment basis precludes taxation on full value of all such property by the state of domicile.

Commentary On General Relief Under The Excess Profits Tax Act Of 1950, Thomas N. Tarleau

Michigan Law Review

Analysis of an excess profits tax involves inquiries which are essentially foreign to the concepts of ordinary income taxation. The question of excess profits arises only after taxable income has been defined and characterized, its recipients determined and the time of receipt established. The problem is to divide taxable income into two components, one representing the corporation's normal profits, which it is permitted to enjoy free of the penalty tax, and the balance which is deemed to be "profits due to the outbreak of hostilities and to large military expenditures." Under the Excess Profits Tax Act of 1950, as was …

Employee Stock Options, Reece A. Gardner

Michigan Law Review

The taxation to an employee of the difference between the fair market value of a share of stock transferred to him by a corporate employer, pursuant to the employee's exercise of an option to acquire it at a price below the value of the share, has for years been a matter of dispute between taxpayers and the Commissioner of Internal Revenue. This dispute has involved not merely, as in the case of many of the hardy tax perennials such as reasonableness of compensation, a question as to the application of facts to a well-defined principle of law, but rather a …

Tax Exempt Charitable Corporations: Revenue Act Of 1950, Maurice Finkelstein

Michigan Law Review

In 1895 Joseph Choate, a distinguished leader of the American Bar, arguing before the Supreme Court of the United States said: "The Act of Congress [the income tax law] which we are impugning before you is communistic in its purposes and tendencies, and is defended here upon principles as communistic, socialistic-what shall I call them -populistic as ever have been addressed to any political assembly in the world. . . . I have thought that one of the fundamental objects of all civilized government was the preservation of the rights of private property. "

While the great advocate no doubt …