# Jess Kraft and Barbara Kraft v. United States

> Court of Appeals for the Sixth Circuit · April 7, 1993 · 991 F.2d 292

URL: https://www.frixlaw.com/law-library/cases/9484151

## Case

- **Full name:** Jess KRAFT and Barbara Kraft, Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee
- **Court:** Court of Appeals for the Sixth Circuit
- **Decided:** April 7, 1993
- **Citations:** 991 F.2d 292; 71 A.F.T.R.2d (RIA) 1493; 1993 U.S. App. LEXIS 7291; 1993 WL 99979
- **Precedential status:** Published
- **Opinion:** Concurrence by Merritt
- **Judges:** Merritt, Nelson, Contie
- **Cited by:** 132 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/9484151

## How later opinions describe it (automated extraction)

- holding that repayment of embezzled funds is an expense deductible under 26 U.S.C. § 165 (c)(2)

## Opinion text

MERRITT, Chief Judge,
concurring.
I concur basically in the reasons stated in Judge Contie’s opinion for denying the Krafts’ petition for a refund. I find the most clearly reasoned and persuasive case *300 on this subject to be Perez v. United States, 553 F.Supp. 558 (M.D.Fla.1982). There the president of a corporation who pled guilty to mail fraud and as a condition of parole was required to make restitution for kickbacks was not allowed a loss deduction for the amounts paid in satisfaction of the restitution requirement. That case appears to be directly in point. In a clear opinion by Judge Krentzman, the court reviewed the legislative history and development of § 1341. It shows that Congress enacted this section in order to overrule the case of United States v. Lewis 340 U.S. 590 , 71 S.Ct. 522 , 95 L.Ed. 560 (1951). It also shows that in enacting § 1341 Congress did not intend to overrule the “claim of right” doctrine. The court concluded “that Congress could not have intended to extend 1341 to embezzlers, for their income was not even taxable in 1954.” 553 F.Supp. at 561 . Thus for the reasons stated in Judge Contie’s opinion and for the reasons stated in the Perez opinion, I would affirm the judgment of the District Court.

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/9484151. Public record. Not legal advice.