¶1dissenting: The majority opinion, in declining to follow this Court’s decision in Otto Sorg Schairer, 9 T.C. 549 (1947), appears to disavow the principle relied upon therein that where the payment was found to be a part of the sale transaction it is taxable as a capital transaction rather than as compensation for services rendered. If such be the import of this case, I must disagree. Where the payment is dependent entirely on the outcome of the employee’s capital transaction and is intended only as a guarantee against loss of the employee’s capital, and is not intended as additional compensation, I do not think either the statute or the principles announced in Commissioner v. Lo Bue, 351 U.S. 243 (1956), and Commissioner v. Duberstein, 363 U.S. 278 (1960), require that it be taxed as compensation. I think the reasoning of this Court in Otto Borg Bchairer, supra, is sound under the present complexion of the law as it was when that case was decided. I would not overrule it.
39 T.C. 652
Bradley v. Commissioner
Decided January 10, 1963
United States Tax Court · decided 1963-01-10
Petitioner, in April 1957, accepted employment with the E. R. Carpenter Co., Inc., and assumed his duties in Richmond, Va., on May 1, 1957. Held: that the payment of $ 5,000 to petitioner in 1958 in accordance with said guarantee represented incentive compensation to petitioner taxable to him as such and was not part of the proceeds of the sale of the property. Otto Sorg Schairer, 9 T.C. 549 (1947), not followed.
Relies on Commissioner of Internal Revenue v. Duberstein D Stanton · Commissioner v. LoBue · Schairer v. Commissioner
Good law ✅— No negative treatment on recordhow we know
Decision will be entered for the respondent · Decided 1963-01-10
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Cited by 11 later decisions — most recently May 1980
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