McCoach v. Minehill & Schuylkill Haven R. Co. - 228 U.S. 295 (1913)
U.S. Supreme Court
McCoach v. Minehill & Schuylkill Haven R. Co., 228 U.S. 295 (1913)
McCoach v. Minehill & Schuylkill Haven Railroad Company
Argued January 14, 15, 1913
Decided April 7, 1913
228 U.S. 295
The corporation tax is imposed upon the doing of corporate business and with respect to the carrying on thereof, and not upon the franchises or property of the corporation irrespective of their use in business. Flint v. Stone Tracy Co., 220 U. S. 107, 220 U. S. 145.
A railway corporation which has leased its railroad to another company operating it exclusively, but which maintains its corporate existence and collects and distributes to its stockholders the rental from the lessee and also dividends from investments, is not doing business within the meaning of the Corporation Tax Act. Park Realty Company case sub Flint v. Stone Tracy Co., 220 U. S. 171, distinguished, and Zonne v. Minneapolis Syndicate, 220 U. S. 187, followed.
Quaere whether such a corporation would be subject to the tax if it exercised the power of eminent domain or other corporate powers for the benefit of the lessee.
192 F. 670 affirmed.
The facts, which involve the construction of the provisions of the Corporation Tax Act as to what constitutes doing business by a corporation so as to subject it to the tax, are stated in the opinion.