Life Sav. Devices Co. v. Commissioner

*308 Before JAMES, LITTLETON, SMITH, and TRUSSELL.

This is an appeal from the determination of a deficiency in income and profits tax for the year 1920 in the amount of $1,477.59.

FINDINGS OF FACT.

The taxpayer is a Delaware corporation with its principal offices located at Chicago, Ill.

Items of income received by the taxpayer in the year were $11,000 for royalties, and $127.95 interest, a total of $11,127.95.

From the gross income above stated of $11,127.95 there was properly allowable a salary of Frank T. Fowler of $3,000; salary of the *309 bookkeeper, M. F. Augustin, $1,690; general expenses of $639.39; telephone, $271.01; rent, $414,46; traveling, $350; other accounts incurred and paid during the year in the total amount of $2,259.40 - total deductions allowable of $8,624.26.

After allowing the deductions indicated above as allowable the net income of the taxpayer does not exceed the sum of $2,503.69.

Included in the accounts payable, not computed as deductible, to Frank T. Fowler and to Frank A. Helmer, were advances on account of expenses*2455 in the year 1920 in the amount of not less than $503.69.

DECISION.

The deficiency determined by the Commissioner is disallowed.