209 A.D. 120 | N.Y. App. Div. | 1924
This is a certiorari to review a determination of the State Tax Commission assessing a franchise tax upon the relator under article 9-A of the Tax Law based upon income received during a period of fourteen months beginning January 1, 1921, and ending February 28, 1922. The period was lengthened by two months due to a change of fiscal year to one beginning March first. The period covered is the same as that reported to the Federal government. Section 214 of the Tax Law (added by Laws of 1917, chap. 728, as amd. by Laws of 1920, chap. 640; Laws of 1921, chap. 705, and Laws of 1922, chap. 507) makes the return to the Federal government subject “ to any correction thereof for fraud, evasion or error, as ascertained by the State Tax Commission.” Under section 209 of the Tax Law (added by Laws of 1917, chap. 726, as amd. by Laws of 1920, chap. 640), the entire net income subject to tax in the State is “ presumably ” the same as the entire net income as reported to the Federal government. The Court of Appeals has said in People ex rel. Barcalo Mfg. Co. v. Knapp (227 N. Y. 64, 71): “ While the basis for the computation of the Commission is the returned net income under the Federal statutes, the Commission is free to fix, from the return and any other information, the true and correct amount of the net income.” The Federal statute provides that in determining net income of a corporation there may be deducted from gross income “ all the ordinary and nee
Hugo Jaeckel, the president of the company, established a business for the manufacture and sale of fur garments in 1861. He established a thriving business and as his sons grew up, three of them went into the business with him and became experts in the various lines of the business. By reason of his advancing years and in order to perpetuate the business, a corporation was formed in 1916 with place of business in New York city and with a large factory at White Plains. The father was made president of the company. Hugo F. Jaeckel, Jr., was made a vice-president with entire charge of the manufacturing end of the business and he was given the management of the finances. Another son, Richard Jaeckel, was made vice-president and was given general supervision of sales. Another son, Walter Jaeckel, was made treasurer and he was placed in charge of the purchase of raw material. Another son, who was practicing law and not engaged in the business, was made secretary at a small salary. The father and these four
The Commission seems to have reached a correct result. One of
The determination should be confirmed, with fifty dollars costs and disbursements.
Determination unanimously confirmed, with fifty dollars costs and disbursements.