Supreme Court of the United States
Commissioner of Internal Revenue v. Lincoln Savings & Loan Assn.
June 14, 1971403 U.S. 345
Summary
The Supreme Court held that Lincoln Savings & Loan Association’s payment of the §404(d) “additional premium” in 1963 was a capital expenditure, not an ordinary and necessary business expense, and therefore nondeductible under §162(a). The Court reversed the Ninth Circuit’s decision and affirmed the Tax Commissioner’s disallowance.
Holding
- Whether the §404(d) “additional premium” paid by Lincoln in 1963 is deductible as an ordinary and necessary business expense under §162(a).. The §404(d) payment is a capital expenditure and is not deductible under §162(a).
Docket 544
Cited authorities
- Rev. Rul. 66-49
- Pub. L. 91-151,
- Rev. Rul. 66-49
- 26 U.S.C. §162
- 47 Stat. 725
- 12 U.S.C. §§ 1421-1449
- 12 U.S.C. § 1426
- 48 Stat. 1256