Commissioner v. Glenshaw Glass Co.
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| Commissioner v. Glenshaw Glass Co. | ||||||||||||
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| Argued February 28, 1955 Decided March 28, 1955 |
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| Holding | ||||||||||||
| The Court held that Congress, in enacting the income taxation statutes, intended to tax all gain except that which was specifically exempted. | ||||||||||||
| Court membership | ||||||||||||
| Chief Justice: Earl Warren Associate Justices: Hugo Black, Stanley Forman Reed, Felix Frankfurter, William O. Douglas, Harold Hitz Burton, Tom C. Clark, Sherman Minton, John Marshall Harlan II |
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| Case opinions | ||||||||||||
| Majority by: Warren Joined by: Black, Reed, Franfurter, Burton, Clark, Minton Dissent by: Douglas Harlan took no part in the consideration or decision of the case. |
Commissioner v. Glenshaw Glass Co. (348 U.S. 426 (1955)) was a case in which the United States Supreme Court held that Congress, in enacting the income taxation statutes, intended to tax all gain except that which was specifically exempted. Also of importance, the Court offered a more comprehensive test for income which required the taxpayer to have, 1) undeniable accessions to wealth, 2) clearly realized, and 3) over which the taxpayer has complete dominion.
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[edit] Facts
Two cases with independent fact backgrounds were consolidated because they presented the same issue. In one case, the defendant Glenshaw Glass Company had won an award of treble damages in an antitrust lawsuit. The defendant did not declare this award as income or pay taxes on it, claiming that it was not subject to taxation. The Internal Revenue Service brought suit to collect the tax. In another case, William Goldman Theatres, Inc. neglected to report treble damages as income. Again, the Internal Revenue Service sued to collect the tax.
[edit] Opinion of the Court
The Supreme Court, in an opinion by Chief Justice Earl Warren, held that the award of treble damages was taxable income.
In the opinion, Warren pointed out that the language of section 22(a) (the predecessor of current section 61(a)) was employed by Congress in order utilize "the full measure of its taxing power," as provided for under the Sixteenth Amendment. Essentially, Congress, in enacting section 22(a), intended to tax all gains except those specifically exempted.
The Court then held that the amounts received by the taxpayers in this case were "instances of undeniable accessions to wealth, clearly realized, and over which the taxpayers have complete dominion."
This three-part "test" for determining income is broader than the earlier test employed by the Court in Eisner v. Macomber, and is to this day the preferred test for identifying gross income.
[edit] See also
[edit] External links
[edit] References
- Samuel A. Donaldson, Federal Income Taxation of Individuals 49-52 (2005).
