# Brief for the Respondent in Opposition — Acker v. Commissioner

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Brief for the Respondent in Opposition
- **Published:** January 1, 1959
- **Citation:** 358 U.S. 940

## Text

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| CITATIONS ‘oe

Brushaber v: Union P sete Rm. 300. 6 1,:.....
Erwin v. Granquist, 253 F. 2d 26, certiorari denied,

CU MEE Se es eg
Foz v. Standard Ol Co., 294 U.S. 87... -. -----

os = Helvering v: Mitchell, 303 U.S. 391. ___-

Panhandle Oli Co. v. Kinoz, 277 U.S. 218... ----
_ Ste-vard Machine Co. v. Davis, 301 U.S: 548__- -----
Waiker vy. Unitéd States, 240 F.2d 601, certiorari
denied, 354 U.S. 939. .-- — Gan the peels
Constitution and Statute: . i ..
; Article i, Section 8. - od ge
- Sixteenth Ainendment..- -----_. _--
Internal Revenue Code of 1939:

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' Sec. 204 (d) (26, U.S.C. 294 (d)). Sige are nua
(1).

492100 58 ;

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Page

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& he Supreme Court of the anitd Bas |

October TERM, 1958

| No. 345.
: Pan N. AcKen, PETITIONER

° ‘ ‘ a Vv. —
2 «

‘COMMISSIONER OF INTERNAL REVENUE

—s

—_—

: ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED
STATRS COURT OF APPRALS FOR THE SIXTH OIRCUIT |
; . yy

BRIEF FOR THE RESPONDENT IN OPPOSITION |

oPrNToms BELOW
_ The memorandum findings of fact_and opinion of
the Tax Court (R. ‘36a-41a)' are not officially re-
ported. -The opinion’ of the Court of Appeals (Pet.
13--23) is ci bie at 258 F.2d - |
| ‘JURISDICTION

The judgment of the Court of Appeals was entered |
_ on June 18, 1958. (Pet. 24.) The taxpayer’ s petition

_+ for amin was denied on September 3, 1958.

‘'(Pet. 24-27.) The petition for a writ of certiorari
was filed on December 1, 1958. The jurisdiction of
” this Court is invoked under 28 U.S, C. 1254. ~ .
1 Record references are to the separately — appendix to .

the = brief in the Court of — |
(1)

. 2
QUESTIONS. PRESENTED

a Whether the court below correctly decided that
the Internal Revenue Code of 1939 is not unconstitu-

tional because of its progressive rates of taxation and

further that such-rates are not excessive or arbitrary
within the meaning of the Fifth Amendment to the
Constitution.

: 2. Whether the court below correctly decided that
Section 294 (d) (1) (A) of. the Internal Revenue

- Cade of 1939, which imposes an addition to the tax for

failure to file a declaration of estimated income tax
required ‘by Section | 58 of the: Code, is_ not
unconstitutional. |

Internal Revenue Cédt of 1939: *

STATUTE INVOLVED

.* , SEC. 294. ADDITIONS TO TAE TAX IN ‘CABE OF NON-
PAYMENT

* + a, mie he =
(d) [As added by Section 118 (a) of the
Revenue Act of 1943, c. 63, 58 Stat. 21) Estt-
nen Taz.—
‘(1) Failure to file duttinathon or pay in-
F poe at of estimated taz.—

(A) Failure to File Declaration.— mi

In the case of a failure to make and file

a deglaration of estimated tax within
the time prescribed,.unless such fail-
ure is shown to the satisfaction of the
Commissioner to be due to reasonable
cause and not to willful neglect, there
shall be added to the tax 5 percentum
_- of .each installment due but unpaid,
and in ‘addition, with respect to each

3
such installment due but unpaid, 1 per
centum of the unpaid amount thereof .
for each month (except the first) or. —
fraction thereof dum ‘g which such
amount remains unpaid. In no event . _
shall the aggregate addition to the tax =~
under this subparagraph with respect
to any installment due but unpaid, éx-
- eeed 10 per centum of .the unpaid por-
tion of-such installment. * ** ~, ° |
ret @ : + * *’ ; Sd
(26 U.S. C. 294.) ae 1
, _ STATEMENT . ne
The Gommissioner has filed a petition for a writ of |
* eertiorari in this same case, No. 553, this Term. The
question presented by’ that petition, however, is ull-
related to the questions presented by this petition. In
No. 553, the question is whether, where a taxpayer has.
failed to file a declaration of estimated income tax as
required by Section’ 58 of the Internal Revenue Code "
of 1939, the Commissioner ‘may impose concurrently
an addition to the tax under Section 294 (4) (2) of
the Code for ‘substantial underestimation of tax, as «
well as an addition under Section 294 (d) (1) (A)
for failure to file a declaration. _
The facts pertinent: to the questions raised in this

- petition may be stated as follows:

The respondent determined the net income an :
tax liability of the petitioner for the years 1947 to
1950 as follows (R. 11a-15a) : ‘i ; ie

e

4

a

| : , Incor . Tas
ee _ $9,412.30] - $1,65201| - $638.32
RC ae ee 15,968.13] . 3, 565. 38 1, 290. 01
etc cheucanrda cuca 9,047.78 | - 1,664.60] § | ‘583.95

1950...-..:-------------] 16, 8@2 18 | - 4,400. 43 231. 04

The penalties included additions for failure to file a
declaration of estimated income tax for each of the
aps involved.
’ The: petitioner petitioned the Tax Court for rede-
termination (R. 2a-7a) and that. court upheld the .
determination of the Commissioner (R. 36a-41la).
On appeal to the Court of Appeals for the Sixth
Circuit, the petitioner, in addition to challenging the
validity of the determinations ‘of deficiencies, also as-
serted the unconstitutionality of the provision requir-
ing a declaration of estimated tax and of a progressive
income tax generally. ‘The court below upheld the.
hog constitutionality of the tax law in both respects (Pet.
App. 13-27). . ie |
. ARGUMENT ©
Tke decinica below, insofar’ as it pertains to. the
questions presented by this petition, is -correct and
there is no conflict offiecisions. ;
kk ‘The claim that\ the Internal Revenue Code of

is plain! without viihaiaillen, As tkis Court pare in
Brushaber v. Union Pactfic R. Co., 240 U.:8. 1, 25:

t is true that it is elaborately insisted that
although there be no express, constitutional pro-

5
- vision prohibiting it, the progressive feature of
the tax causes it to transcend the conception
‘ of all taxation and to be a mere arbitrary abuse:
‘of power which must be treated as wanting in -
due process. But the proposition disregards
the fact that in the very early history of the
Government 'a progressive tax was imposed by
Congress and that such authority was exerted ©
in some if not all of the various income taxes
enacted prior to 1894 to which we have pre-
_ viously adverted. And over and above all this.
the contention but disregards the further fact
that its absolute want of foundation in reason
_ was plainly pointed out in. Knowlton v. Moore,
supra, and the righf to urge it was necessarily |
_' foreclosed by the ruling in that case made.
' Plainly, Congress has the power to levy the income
tax. Constitution, Amendment XVI. ‘‘When the
power to tax exists, the extent of the burden is a mat-
ter for the discretion of the lawmakers.” Fow V.
Standard Oil Co., 294 U. S. 87; 99. To violate the
_ Constitution, the burden. must be so arbitrary as to
amount to a confiscation of property. Brushaber Vv.
Union Pacific R. Co., supra, pp. 24-29; Steward Ma- )
chine Co. v. Davis, 301 U. S. 548, 585; nhandle Oil —
Co. v. Knox, 277 U. S. 218, 223. There has no
a showing here that the rates are so arbitrary as to =.
amount to a confiscaticn of property. The taxpayer ¢
assertion that the rates are unconstitutionally i
_ sive and arbitrary is apparently based on: the .as-
sumption that his claimed deductions are allowable
(but clearly they are not) and that the nation can do
without high taxes (Pet. 3,8-12), As the.court below
indicated (Pet. 23), although the rates imposed by.

a

the 1939 Code are high, they have
fiscation’’ or a “taking”’ in the constitutional sense.

2. In rejecting taxpayer's claim that Section 24
(ad) (2) (A); supra, p. 2, is unconstitutional, the
court below observed that the taxpayer’s attack upon
the constitutionality of the provisions of the Internal
Revenue Code of 1939 requiring the filing of a decla-
ration of estisaated tax (Section 58) and imposing
an addition to the tax for failure to file (Section 2%
(d) (1) (A)) is “‘wholly without merit”, citing two
eases in which this Court recently denied certiorari.
Erwin v. Granquist, 253 F. 2d 26 (C. A. 9th), certi-
_orari denied, 356 U. S. 960; Walker v. United States,
- 240 F. 2d 601 (C. A. 5th), certiorari denied, 354 U.S.
939. -In those cases, arguments similar to the ones
that have been advanced by this taxpayer were re

jected by the Ninth and Fifth Circuits, respectively.

And in Helvering v. Mitchell, 303 U. S. 391, 399, this
Court said :

' As stated i in Oceanic Steam Mavigaiion Cov. §

‘Stranahan, ‘214 U. S. 320, 339: aa

In accord with this settled judigial construc-
tion, the legislation of Congress from the be
ginning, not only as to tariff but as to internal
revenue, taxation and other ‘subjects, has pro-
ceeded on the conception that it was within the
competency of Congress, when legislating as to
matters exclusively within ‘its control, to impose
appropriate obligations and sanction their et-
forcement by reasonable money penalties, giv-
ing to executive officers the power to enforce
such penalties without the necessity of invoking
the judicial power. ease

Cygre as

meet

Thus, as the court below observed (Pet. 16), the
provisions of the Code here under attatk are a valid
exercise of the taxing power conferred by Article 1,
“ Section 8, and the Sixteenth Amendment to the
Constitution.

\

.

The decision below pertaining to the questions raised
by this petition is correct and no other reason appears
for further review by this Court. Therefore, the pe-

_ tition should be denied. |
Respectfully submitted,
J. Lee Rankin,
Solicitor General.
CHARLES K. RIcE,
- Assistant Attorney General.
Rosert N. ANDERSON,
Cuagigs B. E. FREEMAN, .
Attorneys.

DECEMBER 1958.

ry

© 8 SCvERamENT PRimTINZ OFFICE: 1908 -

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386419_0645%3A3. Public record. Not legal advice.