278 U.S. 181 (1929), 58, Russell v. United States

Docket Nº:No. 58
Citation:278 U.S. 181, 49 S.Ct. 121, 73 L.Ed. 255
Party Name:Russell v. United States
Case Date:January 02, 1929
Court:United States Supreme Court

Page 181

278 U.S. 181 (1929)

49 S.Ct. 121, 73 L.Ed. 255



United States

No. 58

United States Supreme Court

Jan. 2, 1929

Argued November 22, 1928




1. The Revenue Act of 1921 limited the time within which income and profits taxes imposed by the Act of 1918 might be assessed, and within which suit might be brought to collect them, to five years from the filing of the return. Section 277 of the Revenue Act of 1924 preserves the same limitation generally, but where assessment is made within the prescribed period, § 278 permits suit to be brought within six years from the assessment, that section declaring, however, that it shall not authorize any suit barred by existing limitation, or "affect any assessment" made before the date of the Act. Held, considering these and other features of the 1924 Act, that the provision extending the time for suit should be construed prospectively as relating only to assessments made after that Act was passed. P. 185.

2. Changes introduced by a later Act cannot authorize construction of an earlier one not consonant with its language. P. 188.

22 F.2d 249 reversed.

Certiorari, 276 U.S. 612, to a judgment of the circuit court of appeals which reversed a decree dismissing a bill brought by the United States against the stockholders to recover the amount of income and profits taxes which had been assessed against a corporation before it was dissolved and its assets distributed among the defendants.

Page 182

MCREYNOLDS, J., lead opinion

MR. JUSTICE McREYNOLDS delivered the opinion of the Court.

The United States, by bill filed January 23, 1925, sought to recover from petitioners, stockholders of the Pine Lumber Company, additional income and profit taxes for the year 1918 assessed against that corporation in March, 1924. The company made a return to the collector for 1918 on June 12, 1919, and afterwards paid the amount indicated thereby.

Petitioners claimed the suit was barred under the limitation specified by the applicable statute. They succeeded in the district court, but the circuit court of appeals held another view, and reversed the decree dismissing the bill.

The statutory provisions which require special consideration are printed below:

Revenue Act 1918, c. 18, 40 Stat. 1057, 1083:

Sec. 250(d). Except in the case of false or fraudulent returns with intent to evade the tax, the amount of tax due under any return shall be determined and assessed by the Commissioner within five years after the return was due or was made, and no suit or proceeding for the collection of any tax shall be begun after the expiration of five years after the date when the return

Page 183

was due or was made. . . .

Revenue Act 1921, c. 136, Tit. II, "Income Tax," 42 Stat. 227, 265:

Sec. 250(d). The amount of income, excess profits, or war-profits taxes due under any return made under this Act for the taxable year 1921 or succeeding taxable years shall be determined and assessed by the Commissioner within four years after the return was filed, and the amount of any such taxes due under any return made under this Act for prior taxable years or under prior income...

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