holding that business income is taxable to the person who owns and controls the business
How later courts described this case
- holding that business income is taxable to the person who owns and controls the business
Written by the judges who cited it.
The opinion
Murdock, J.. dissenting: All of the income here in question had to be earned by somebody performing the necessary work to bring it in. Eobert, Jr., did the work. His father and mother did not. Therefore, I do not think the income is taxable to the parents. If the loans from the parents were made at less than a proper rate of interest, a proper rate of interest could be determined and the difference taxed to the parents. But the parents did not make the loans that brought in the 6 per cent interest and they should not be taxed on that amount or upon any of the other items which the Commissioner has taxed to them.
Turner, Opper, Baum, and Pierce, //., would tax the income from the commissions and rebates to petitioners who directly or through their subservient agencies not only really earned the income but controlled and could at any time change its destination.