Currier v. United States, 4246.
| Decision Date | 27 February 1948 |
| Docket Number | No. 4246.,4246. |
| Citation | 166 F.2d 346 |
| Parties | CURRIER et al. v. UNITED STATES. |
| Court | U.S. Court of Appeals — First Circuit |
Richard C. Sheppard, of Boston, Mass., for appellants.
Meyer Rothwacks, Sp. Asst. to Atty. Gen. (Theron L. Caudle, Asst. Atty. Gen., George A. Stinson, Sp. Asst. to Atty. Gen., and William T. McCarthy, U. S. Atty., and Joseph M. Hargedon, Asst. U. S. Atty., both of Boston, Mass., on the brief), for appellee.
Before MAGRUDER, MAHONEY, and WOODBURY, Circuit Judges.
Harold C. Currier and the Currier Lumber Co., Inc., have appealed from convictions for attempting to defeat and evade federal taxes.
Harold Currier owned 75% of the stock of the Currier Lumber Company. He was president and treasurer of the company and a director. The remaining 25% of the stock was held by his wife. In 1943 and 1944 numerous checks, given in payment for sales of lumber by the corporation and made payable to the Currier Lumber Company were received by Harold Currier, endorsed by him with the legend "Currier Lumber Co. H.C. Currier" and deposited by him in his personal account. No account of the receipt of these checks appears on the corporation books. Harold Currier in making the corporate tax returns and his individual tax returns for the years 1943 and 1944 did not include these checks in either the corporation's or his gross income. In one indictment Harold Currier and the Currier Lumber Company were charged with wilfully attempting to defeat and evade federal taxes in violation of § 145(b) of the Internal Revenue Code, 26 U.S.C.A. Int.Rev.Code, § 145(b), by filing false and fraudulent corporation tax returns for the years 1943 and 1944. In the other indictment Harold Currier was charged under the same statute with wilfully attempting to defeat and evade federal taxes by filing false and fraudulent personal tax returns for the years 1943 and 1944. The defendants waived jury trial and were found guilty on all counts by the district court. 70 F.Supp. 219. This appeal followed.
In regard to the first indictment the defendants claim that even if the corporation should have included the checks in its gross income it was entitled to a deduction for "embezzlement" by Currier so that its net income was correctly reported. This contention is without merit. The trial court found that part of the money taken by Currier was a constructive dividend. Certainly the corporation is entitled to no deduction for dividends paid. As for the rest of the money, the corporation is entitled to no deduction since it has a cause of action against Currier for that amount if it be regarded as borrowed or embezzled or taken without right. If it be regarded merely as a return of capital to a stockholder, then, of course, the corporation is entitled to no deduction.
The defendants also contend in regard to the first indictment that Harold Currier...
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