The opinion
*379 OPINION.
Lansdon :
In the circumstances set out in our findings of fact we are of the opinion that the cash value of the two insurance policies paid to A. D. Saenger in the taxable year as additional compensation for services rendered to Saenger Theatres, Inc., was income to Saen-ger in that year. The terms of the partnership agreement between the Saenger brothers have no bearing on this issue. Upon the organization of A. & J., Inc., petitioner A. D. Saenger transferred to that enterprise all his interest in Saenger Brothers partnership and, in addition, agreed to pay to such corporation the full amount of all salaries and fees received as compensation for services rendered to others and received 7,499 shares of the capital stock of the corporation which had a par value of $100 per share in consideration of such transfer and agreement. In these circumstances it is obvious that any amounts which Saenger later paid to the corporation in conformity with his agreement must be regarded as additional capital contributions to the corporation.
On brief petitioner relies on James S. Muir, 3 B.T.A. 165 . Since Muir was not a stockholder of the concern which received his salary by virtue of agreement to that effect, that proceeding varies so widely as to its facts that it has no bearing on the issue in this controversy.
Decision will be entered for the respondent.