Walberg

This is a suit for the refund of taxes paid under protest by plaintiffs, Richard Walberg and his wife Mary Ruth Walberg. Jurisdiction is sounded on 28 U.S. C. § 1340. Plaintiffs attributed portions of the business income of the construction firm of Swinerton & Walberg for the years 1946 and 1947 to a trust for plaintiffs’ minor son; this trust was treated as a limited partner in the construction firm. Defendant, formerly a Collector of Internal Revenue, reallocated the trust income to plaintiffs, contending that the income was actually earned by plaintiff Walberg.

The plaintiff, Richard Walberg, was a member of a number of contracting, engineering and construction business firms. In most of these business enterprises he has been associated with Alfred B. Swinerton, a name well known in the building and construction business for many years. The plaintiff is recognized as competent engineer and executive in the building and construction field. In 1929 he joined the firm of Lindgren & Swinerton, Inc., a corporation founded by Swinerton. He is also associated with Swinerton in other firms which have had various forms of business organization, such as corporations, partnerships, and…