Aspro, Inc. v Commissioner

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January 21, 2021

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2951 Asphalt Paving Mixtures and Blocks
324121 Asphalt Paving Mixture and Block Manufacturing
federal taxation
management fees, shareholders, salary, distributions, deductible, disguised dividends, compensation paid, management services, provide a service
Aspro, Inc. v Commissioner
T.C. Memo 2021-8, 2021 Tax Ct. Memo LEXIS 6
US
Federal Court
Federal
United States Tax Court
Ken Nunes
Pugh

Summary

The U.S. Tax Court recently agreed with the Internal Revenue Service that management fees a corporation paid to its three shareholders over a three-year period were not deductible since none of the fees were paid “purely for services” and the petitioner failed to show the fees were “ordinary, necessary, and reasonable.” Rather, they represented disguised distributions, the court found.
Aspro, Inc. v Commr.
PDF, Size: 173 KB

See Also

Tax Court Rejects Claimed Deduction for Management Fees

Court Case Digests
January 21, 2021

The U.S. Tax Court recently agreed with the Internal Revenue Service that management fees a corporation paid to its three shareholders over a three-year period were not deductible since none of the fees were paid “purely for services” and the petitioner failed to show the fees were “ordinary, necessary, and reasonable.” Rather, they represented disguised distributions, the court found.