Kluckhohn v. Comm'r of Internal Revenue, Docket No. 34325.
| Decision Date | 22 August 1952 |
| Docket Number | Docket No. 34325. |
| Citation | 18 T.C. 892 |
| Parties | FRANK L. KLUCKHOHN AND JUNE E. KLUCKHOHN, PETITIONERS, v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT. |
| Court | U.S. Tax Court |
OPINION TEXT STARTS HERE
INCOME— EXEMPTION— NONRESIDENT— EARNED INCOME— SOURCES WITHOUT THE UNITED STATES— SECTION 116(a)(3).— An amount received by a nonresident citizen of the United States from the Reader's Digest for foreign rights to an article written while the taxpayer was abroad, which rights were sold in this country after the article had been written, does not constitute earned income within the meaning of section 116(a)(3) and is not exempt. E. Phillips Oppenheim, 31 B.T.A. 563, followed. Frank L. Kluckhohn, pro se.
S. Jarvis Levison, Esq., for the respondent.
The Commissioner determined a deficiency of $1,556.98 in the income tax of the petitioners for 1947. The petitioners contend that the Commissioner erred in including in income $1,200 received by Frank allegedly as earned income from sources without the United States, within the meaning of section 116 of the Internal Revenue Code, and in disallowing deductions for travel expense, charitable contributions, taxes, and medical expenses.
The petitioners, husband and wife, filed a joint return for 1947 with the collector of internal revenue for the district of Minnesota. They were nonresident citizens of the United States living in Argentina from sometime in 1945 until about February of 1947 when they returned to the United States where Frank remained during the rest of 1947. Frank was a newspaper correspondent and writer and June at times assisted him.
Frank, while in Argentina during 1946, wrote an article for the Saturday Evening Post with reference to Peron. He retained the right to sell the article in all countries other than the United States. He received a letter, while in the United States, early in 1947 from the Reader's Digest which made him an offer to reprint the Peron article in foreign countries. Frank accepted the offer and received $1,200 in 1947 from the Reader's Digest for the rights which it bought. The petitioners did not report the $1,200 as gross income for 1947. The Commissioner, in determining the deficiency, included the $1,200 in gross income and thereby committed no error.
Frank, while residing in the United States during 1947, gave four lectures. He failed to report and the Commissioner properly added to his income $350 received from lecturing in 1947. The petitioners deducted $450 on their return as expenses in connection with the four lectures. The Commissioner allowed $225 of that amount and disallowed the remaining $225. The traveling expenses of Frank in connection with the lectures, including the amount expended for meals and lodging while away from home giving those lectures, was $300.
The petitioners were of the opinion that articles about Australia would be salable and they had considered making a trip to Australia while living in Argentina. No definite plans were made until June's father, who lived in Australia, suffered a heart attack in the spring of 1947. They then decided that June would make the trip for family reasons and also to obtain material for one or more articles to be written by Frank. She left Boston in September 1947 and did not return until February 1948. She gathered information during the trip to be used by Frank, and some of that material was used by him in writing a book and in writing an article. A reasonable portion of the total amount expended by her in connection with this trip during 1947 attributable to the collection of information for use by Frank in his business of writing was $700. The petitioners claimed a deduction on their return of $2,000, representing expenses of June's trip to Australia. The Commissioner disallowed the entire amount claimed.
The petitioners made contributions to religious and charitable organizations of $325 in 1947 deductible under section 23(o)(2) of the Internal Revenue Code. They claimed a deduction of $1,138 for charitable contributions on their return and the Commissioner disallowed the entire amount for lack of substantiation.
The petitioners spent $1,000 in 1947 for medical expenses, a part of which were incident to the birth of their child and a part of which were for Frank's mother, his dependent, within the meaning of section 25(b)(3)(D). They reported on their return medical expenses of $1,000 and claimed a deduction of $431 which the Commissioner disallowed in determining the deficiency.
The petitioners claimed a deduction of $150 for ‘gasoline, theatre, and incidental‘ taxes. The Commissioner, in determining the deficiency, disallowed $75 of the amount claimed and allowed the remainder. The record does not show that the petitioners are entitled to a larger deduction for these taxes than the amount...
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Faura v. Comm'r of Internal Revenue , Docket No. 10041-77.
...for travel, entertainment, and other business expenses, this Court held that such expenditures were deductible. 4 In Kluckhohn v. Commissioner, 18 T.C. 892 (1952), the taxpayer was a newspaper correspondent and writer. His wife traveled to Australia and gathered material which he used in wr......
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Hadley v. C.I.R., s. 678
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Tobey v. Comm'r of Internal Revenue , Docket No. 1144-70.
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