Stice v. United States’s Empirical Analysis

Citation profile

7 federal appellate ·

Most-quoted passages

The sentences later courts lift from this opinion, ranked by how many decisions quote each — the parts of the opinion doing the work. These counts are smaller than the citation total above because most of the 14 citing decisions cite the case generally; a passage count includes only decisions quoting that exact language verbatim.

1. “Whether a particular expenditure is a deposit or a payment depends on the facts and circumstances of each case. Where it can be shown that the expenditure is made pursuant to a binding commitment to accept delivery of a specific quantity at a fixed price, and the buyer is not entitled, under contract provision or business custom, to a refund or repurchase, the expenditure will not be considered a deposit. The following factors, although not all inclusive, are indicative of a deposit, rather than a payment: the absence of specific quantity terms; the right to refund of any unapplied credit at the termination of the contract . . .; and the right to substitute other goods or products for the [goods] specified in the contract. Rev. Rule 75-152. 18”

   5 later decisions quote this exact passage · from the majority
   e.g. Schenk v. Commissioner · Schenk v. Commissioner

2. “This record contains no evidence that the taxpayer sought or secured the type of advantage under discussion. There was no indication of any shortage of the goods ordered, or that taxpayer would receive any business advantage not available without any prepayment. Taxpayer received no cost advantage as he paid more for the fertilizer received than the December 1969 agreement provided for. Lastly, such prepayment was not a condition imposed by the seller. Taxpayer was the only Johnson Gin’s customer ever making a substantial prepayment. For the enumerated reasons, the jury verdict for the taxpayer is not supported by the evidence. The only logical conclusion to be drawn from the record is that the dominant, if, indeed not the only purpose for taxpayer’s substantial end-of-year prepayments was an attempt to provide a basis for a significant tax deduction for the taxable year 1969. The Commissioner’s disallowance of such deduction was justified as a matter of law, and accordingly it was error for the district court to deny the government’s motion for judgment n.o.v.”

   1 later decision quote this exact passage · from the majority
   e.g. 652 F. Supp. 972 - Golden Rod Farms, Inc. v. United States

3. ““The second test [for deductibility] is that the prepayment must be made for a valid business purpose and not merely for tax avoidance. Generally, the factor that distinguishes the court decisions allowing a deduction for prepaid feed costs from those disallowing the deduction is the acquisition of, or the reasonable expectation by the taxpayer of receiving, some business benefit as a result of the prepayment; See John Ernst, 32 T.C. 181 (1959), acq., 1959- 2 C.B. 4 ; Cravens v. Commissioner, 272 F.2d 895 (10th Cir. 1959); Shippy v. United States, 308 F.2d 743 (8th Cir.1962), aff’g 199 F.Supp. 842 (W.D.S.Dak.1961), aff’d per curiam, 370 F.2d 562 (9th Cir.1966). Examples of business benefit include, but are not limited to: fixing maximum prices and securing an assured feed supply or securing preferential treatment in anticipation of a feed shortage. Whether the prepayment was a condition imposed by the seller and whether such condition was meaningful should also be taken into consideration in determining whether there was a business purpose for the prepayment.””

   1 later decision quote this exact passage · from the majority
   e.g. 652 F. Supp. 972 - Golden Rod Farms, Inc. v. United States