Burnet v. Porter, 283 U.S. 230 (1931)

U.S. Supreme Court

Burnet v. Porter, 283 U.S. 230 (1931) Burnet v. Porter

No. 203

Argued March 12, 1931

Decided April 13, 1931

283 U.S. 230

CERTIORARI TO THE CIRCUIT COURT OF APPEALS

FOR THE THIRD CIRCUIT

Syllabus

1. The Commissioner of Internal Revenue, after approving a deduction for loss in an income tax return and allowing a claim for refund of the proportional part of the tax, had authority to reopen the case later, disallow the deduction and redetermine the tax.

2. Decided, as respects proof of deductible loss, upon the authority of Burnet v. Houston, ante, p. 283 U. S. 223.

39 F.2d 360 reversed.

Certiorari, 282 U.S. 821, to review a judgment which reversed a decision of the Board of Tax Appeals, 13 B.T.A. 279, sustaining disallowance of a deduction for a loss in an income tax return.

Page 283 U. S. 231

MR. JUSTICE SUTHERLAND delivered the opinion of the Court.

William W. Porter was a subscriber in the sum of $75,000 to the fund described in our opinion handed down this day in No.199, Burnet v. Houston, ante, p. 283 U. S. 223. The facts in the present case are the same except that the Commissioner of Internal Revenue first approved the deduction and allowed a claim for refund of the proportional part of the tax, and then some time later reopened the case, disallowed the deduction, and redetermined the tax. The Court of Appeals sustained the power of the Commissioner upon the authority of McIlhenny v. Commissioner, 39 F.2d 356, and was clearly right in doing so. That court, however, upon the main point, following its decision in the Houston case, reversed the determination of the Board of Tax Appeals in favor of the government. 39 F.2d 360. This is contrary to our decision in the Houston case, and, upon that authority, the judgment is reversed.