Mallen v. Commissioner

APPEAL OF HERMAN W. MALLEN.
Mallen v. Commissioner
Docket No. 2060.
United States Board of Tax Appeals
2 B.T.A. 801; 1925 BTA LEXIS 2270;
October 5, 1925, Decided Submitted May 20, 1925.
*2270 J. Walter Stead, Esq., for the taxpayer.
Blount Ralls, Esq., for the Commissioner.

*801 Before STERNHAGEN, LANSDON, GREEN, and LOVE.

This appeal is from the determination of a deficiency in income taxes for the years 1920 and 1921 in the amount of $7,121.63. The taxpayer concedes $1,715.21 and appeals as to $5,406.42.

The books of the business were not offered in evidence and no evidence was offered tending to controvert the correctness of the Commissioner's determination as to the true net income of the taxpayer for the years in question.

FINDINGS OF FACT.

The taxpayer is a member of a partnership and his income arises almost solely from the distribution of partnership profits.

Prior to 1920 the business was operated by Herman Mallen, who conducted it under the trade name of H. Z. Mallen & Co.

H. Z. Mallen & Co. had regularly made returns on the calendar year basis. The books of the company prior to, as well as during and after, 1920, were kept on a fiscal year basis ending November 30. Inventories were taken November 30 and extensions based largely on estimates were made to include the month of December.

The taxpayer made his income-tax*2271 returns for 1920 and 1921 in accordance with showings made from the partnership books handled as above indicated.

*802 The Commissioner refused to accept the returns so made and after an audit of the partnership books adjusted them to a fiscal year basis ending November 30 of each of the years in question and thus enlarged the distributive share of the partnership profits.

DECISION.

The determination of the Commissioner is approved.

ARUNDELL not participating.