Appeal of BANK OF ROCKINGHAM

Appeal of BANK OF ROCKINGHAM. Docket No. 4682. Submitted October 2, 1925. Decided April 1, 1926. B. F. Reynolds, Esq., for the taxpayer. T. P. Dudley, Jr., Esq., for the Commissioner. Before Maequette and Gebek. This appeal is from the determination of a deficiency in income and profits taxes for the year 1920 of $2,681.52. The amount in controversy is approximately $1,847.87 and arises from the inclusion in ;he gross income of the taxpayer for that year of certain discounts m notes purchased during the taxable year. [MAJORITY] FINDINGS OP FACT. The taxpayer is a North Carolina corporation engaged in th< commercial and savings bank business at Rockingham. Its books of account were kept on the basis of cash receipts and disbursements During the year 1920 the taxpayer discounted certain notes witl accrued interest, the discount upon which amounted to $4,642. Nc part of the said notes was paid during the taxable year 1920. The Commissioner has included in gross income the said sum oi $4,642 as income to the taxpayer in the year 1920. The discount in the amount of $1¡.,61¡.2 should be excluded frorr, gross income of the year 1920, and the tax computed accordingly Appeal of Chatham <& Phenix National Bank, 1 B. T. A. ⅛60, Appedl of Bank of Eartsville, 1 B. T. A. 920. Order of redetermination will be entered on 10 days' notice, under Rule 50.