Monday, April 29, 2013

Commissioner v. Glenshaw Glass Co. case brief

Commissioner v. Glenshaw Glass Co. case brief
348 U.S. 426, 75 S. Ct. 473, 99 L. Ed. 483, 1955 U.S.

CASE SYNOPSIS: Petitioner Commissioner of Internal Revenue sought review of a judgment of United States Court of Appeals for the Third Circuit, which affirmed a tax court judgment holding that respondent taxpayers were not required to report their awards of punitive damages as income under 26 U.S.C.S. § 22(a).

FACTS: The taxpayers received punitive damages from judgments in their favor, but they did not report the damages as gross income. The tax court and the appellate court concluded that they did not have to report the damages as income under § 22(a).

On certiorari, the Court held that recovery of punitive damages was taxable income under § 22, which determined what was taxable gross income and which was given a broad and liberal construction.

The intention of Congress was to tax all gains of income except those specifically exempted. In reversing the judgment, the Court held that it was anomalous to conclude that recovery of actual damages was taxable, but not the additional amount extracted as punishment for the same conduct that caused the injury. Punitive damages were not gifts, could not be considered a restoration of capital for taxation purposes, and did not fit under any exemption provision of the Internal Revenue Code.

CONCLUSION: The Court reversed the appellate court's judgment.
Interested in learning how to get the top grades in your law school classes? Want to learn how to study smarter than your competition? Interested in transferring to a high ranked school?

No comments:

Post a Comment

The Evolution of Legal Marketing: From Billboards to Digital Leads Over the last couple of decades, the face of legal marketing has changed a l...