Chamansky v. Commissioner

This is a proceeding for the redetermination of a deficiency in income tax for the year 1921 in the amount of $417.91. There is in dispute only the amount of $75.26, which results from the action of the respondent in adding to petitioner’s income for 1921 the amount of $1,006.93, received from an endowment policy in excess of the total amount of premiums paid in.

This case was submitted on the pleadings, respondent in his answer having admitted the facts alleged in the petition to be true.

Petitioner alleged in his petition that the amount received on the endowment policy represented partly interest and partly dividends, and that under article 47 of Regulations 62 his tax liability should be computed as set out in his petition, which computation showed a 'deficiency of $342.65 instead of $417.91 as determined by the respondent.

In the computation set out in the petition, the amount of $66.19 was allocated by the petitioner to interest, subject to both normal and surtax, and the amount of $940.74 was allocated to dividends, subject only to surtax. The respondent contends that the entire amount of $1,006.93 was subject both to normal and surtax and so computed the deficiency.

While the respondent admitted in his answer the facts alleged in the petition, he specifically denied that the amount in question was a distribution on a paid-up policy of insurance and that the amount received by the petitioner should be treated and taxed as income from dividends. In view of the answer, we can not accept as an admitted fact the figures used by the petitioner in his computation.

*1277On this state of the record, we can not determine that the respondent committed error. The determination of the respondent is approved. See Appeal of E. A. Armstrong, 1 B. T. A. 296.

Judgment will be entered for the respondent.