*4225 Construction placed upon section 205(c) of the Revenue Act of 1921 by Appeal of Theodore Schilling,3 B.T.A. 936, approved.
*1409 These are proceedings for the redetermination of income taxes for the calendar years 1921 and 1922, in the amounts of $540.51 and $784.23, respectively. The facts were stipulated.
*1410 FINDINGS OF FACT.
The petitioner is a resident individual. Notices of deficiencies were mailed to the petitioner on January 23, 1926, with respect to the 1921 tax, and on June 8, 1926, with respect to the 1922 tax. The taxes in controversy are income taxes for the calendar years 1921 and 1922 in the amounts of $540.51 and $784.23, respectively. Petitioner's returns for the years 1921 and 1922 were correctly filed upon a calendar year basis.
Petitioner is a member of a partnership doing business under the name of Frederick Ludewig & Co., whose fiscal years ended June 30, 1921, and 1922, and who filed their tax returns on the basis of fiscal years ending June 30, 1921, and June 30, 1922.
Petitioner's*4226 share in the net income of the above-named partnership for the fiscal year ended June 30, 1921, amounted to $13,919.88, of which $6,959.94 applied to the year 1920, and for the fiscal year ended June 30, 1922, amounted to $16,265.79, of which $8,132.89 applied to the year 1921.
Petitioner's net income for the calendar year 1921 amounted to $18,282.82, which included the petitioner's share of the partnership income applicable to the year 1921, $6,959.94, other income applicable to the year 1921, $4,362.94, and petitioner's share of partnership income applicable to the year 1920, $6,959.94. His net income for the year 1922 amounted to $23,755.97, which included the petitioner's share of the partnership income applicable to the year 1922, $8,132.90, other income applicable to the year 1922, $7,490.18, and petitioner's share of partnership income applicable to the year 1921, $8,132.89.
Petitioner is married and entitled to an exemption of $2,000 for both 1921 and 1922 income-tax purposes.
1921.
The tax liability of the petitioner as shown by his income-tax return is computed by him as follows:
| Normal tax for 1921: | ||
| Net income $6,959.94+$4,362.94 | $11,322.88 | |
| Exemption | 2,000.00 | |
| 9,322.88 | ||
| Subject to tax at 4 per cent | 4,000.00 | $160.00 |
| Subject to tax at 8 per cent | 5,322.88 | 425.83 |
| Surtax on $11,322.88 at 1921 rates: | ||
| Income to $6,000 | 10.00 | |
| Income $6,000 to $8,000 at 2 per cent | 40.00 | |
| Income $8,000 to $10,000 at 3 per cent | 60.00 | |
| Income $10,000 to $11,332.88 at 4 per cent | 52.92 | |
| 162.92 | ||
| Normal tax for 1920: | ||
| Net income | $6,959.94 | |
| Subject to tax at 4 per cent | 4,000.00 | $160.00 |
| Subject to tax at 8 per cent | 2,959.94 | 236.80 |
| Surtax on $6,959.94 at 1920 rates: | ||
| Income to $6,000 | 10.00 | |
| Income $6,000 to $6,959.94 at 2 per cent | 19.20 | |
| 29.20 | ||
| 1,174.75 |
*4227 *1411 The tax liability of the petitioner as computed by the respondent is as follows:
| Total net income | $18,282.82 | |
| Less exemption | 2,000.00 | |
| 16,282.82 | ||
| Normal tax at 4 per cent | 4,000.00 | 160.00 |
| Normal tax at 8 per cent | 12,282.82 | 982.63 |
| Surtax on $11,322.88 at 1921 rates: | ||
| Income to $6,000 | 10.00 | |
| Income $6,000 to $8,000 at 2 per cent | 40.00 | |
| Income $8,000 to $10,000 at 3 per cent | 60.00 | |
| Income $10,000 to $11,322.88 at 4 per cent | 52.92 | |
| 162.92 | ||
| Surtax on $6,959.94 at 1920 rates: | ||
| Income $11,322.88 to $12,000 at 4 per cent | 27.08 | |
| Income $12,000 to $14,000 at 5 per cent | 100.00 | |
| Income $14,000 to $16,000 at 6 per cent | 120.00 | |
| Income $16,000 to $18,000 at 7 per cent | 140.00 | |
| Income $18,000 to $18,282.82 at 8 per cent | 22.62 | |
| 409.71 | ||
| Total tax liability | 1,715.26 | |
| Tax previously determined | 1,174.75 | |
| Deficiency tax shown in deficiency letter | 540.51 |
1922.
The tax liability of the petitioner as shown by his income-tax return is computed by him as follows:
| Normal tax for 1922: | ||
| Net income $7,490.18+$8,132.90 | $15,623.08 | |
| Exemption | 2,000.00 | |
| 13,623.08 | ||
| Subject to tax at 4 per cent | 4,000.00 | $160.00 |
| Subject to tax at 8 per cent | 9,623.08 | 769.85 |
| Surtax on $15,623.08 at 1922 rates: | ||
| Income to $10,000 | 40.00 | |
| Income $10,000 to $12,000 at 2 per cent | 40.00 | |
| Income $12,000 to $14,000 at 3 per cent | 60.00 | |
| Income $14,000 to $15,623.08 at 4 per cent | 64.92 | |
| 204.92 | ||
| Normal tax for 1921: | ||
| Net income | $8,132.89 | |
| Subject to tax at 4 per cent | 4,000.00 | $160.00 |
| Subject to tax at 8 per cent | 4,132.89 | 330.63 |
| Surtax on $8,132.89 at 1921 rates: | ||
| Income to $6,000 | 10.00 | |
| Income $6,000 to $8,000 at 2 per cent | 40.00 | |
| Income $8,000 to $8,132.89 at 3 per cent | 3.99 | |
| 53.99 | ||
| 1,679.39 |
*4228 *1412 The tax liability of the petitioner as computed by the respondent is as follows:
| Total net income | $23,755.97 | |
| Less: Exemption | 2,000.00 | |
| 21,755.97 | ||
| Normal tax at 4 per cent | 4,000.00 | $160.00 |
| Normal tax at 8 per cent | 17,755.97 | 1,420.48 |
| Surtax on $15,623.08 at 1922 rates: | ||
| Income to $10,000.00 | 40.00 | |
| Income $10,000 to $12,000 at 2 per cent | 40.00 | |
| Income $12,000 to $14,000 at 3 per cent | 60.00 | |
| Income $14,000 to $15,623.08 at 4 per cent | 64.92 | |
| Surtax on $8,132.89 at 1921 rates: | ||
| Income $15,623.08 to $16,000 at 6 per cent | 22.62 | |
| Income $16,000 to $18,000 at 7 per cent | 140.00 | |
| Income $18,000 to $20,000 at 8 per cent | 160.00 | |
| Income $20,000 to $22,000 at 9 per cent | 180.00 | |
| Income $22,000 to $23,755.97 at 10 per cent | 175.60 | |
| 883.14 | ||
| Total tax liability | 2,463.62 | |
| Tax previously determined | 1,679.39 | |
| Deficiency tax shown in deficiency letter | 784.23 |
OPINION.
SIEFKIN: The petitioner in these cases is a member of the same partnership considered in the . In that case we approved the respondent's computation of taxes and held that the method used was in accordance with section*4229 205(c) of the Revenue Act of 1921. Petitioner in these cases, although he points out a difference in that Theodore Schilling was a nonresident alien, whereas he is a resident citizen, and in that the rates of the year 1922 were different from those of 1921, admits that there is no difference in principle between the Schilling case and these cases and frankly asks the Board to reconsider its holding in the Schilling appeal.
*1413 All the reasons that can be urged in favor of the petitioner's position were urged by the same able counsel in the Schilling case and were the subject of a full discussion in the dissenting opinion in that case. The argument in the second of these proceedings growing out of the difference in rates between the years 1921 and 1922, is nothing more than an emphasis of the position taken in the Schilling case by the petitioner, and which forms the basis of the dissenting opinion. We hold to our former decision and approve the determination of the respondent.
Judgment will be entered for the respondent.