Wisdom Et Ux. v. United States

In the years 1943, 1944 and 1945, the Blatz Brewing Company of Milwaukee, Wisconsin, was represented in the States of California, Arizona and Nevada, and the Territory of Hawaii, by a wholesale commission broker known as P. W. Wisdom, of Los Angeles. The taxpayer, Paul W. Wisdom, one of the appellants here, asserts that the “P. W. Wisdom”, broker for Blatz, was for tax purposes a partnership composed of himself, his wife, and his two married daughters. The income of the business for those years was returned in separate tax returns in which the two appellants, Paul W. Wisdom and his wife, Evelyn F. Wisdom, each included one-third of the income from the operation of the business for those years. Each of the two daughters included in her income, as returned, one-sixth of the income from the business. The Commissioner of Internal Revenue made a determination that the business was exclusively that of Paul W. Wisdom, and that the income from the business for those years should be equally divided between Wisdom and his wife, the latter participating by reason of her community property interest.

The appellants paid all taxes thus assessed against them and brought actions below, which…