Alan W. Ladd and Sue Carol Ladd v. Robert A. Riddell, District Director of Internal Revenue, Los Angeles, California, Etc.

Alan W. Ladd, a taxpayer, appeals from a judgment of the United States District Court denying his claim for refund of federal income taxes for the taxable year ended December 31, 1954.

In 1952, Taxpayer, a citizen of the United States and a well-known actor, was employed by Warwick Productions, Inc., to act in “The Red Beret”, a motion picture to be produced in England and to be exhibited throughout the world. For his services, Taxpayer was guaranteed the sum of $200,000, plus certain fringe benefits. In addition to the “guaranteed compensation,” Taxpayer was entitled to receive approximately ten per cent of the gross receipts in excess of $2,000,000 as “deferred compensation.”

He worked from September 20, 1952, until December 6, 1952, a period of approximately eleven weeks, and was paid the $200,000 in 1952. In 1954, he received $73,998.97 which had become due to him in that year as deferred compensation.

Taxpayer arrived in England on September 12, 1952, and left England on December 26, 1952, but did not return to the United States until February 27, 1954, a period of 514 full days in a period of 18 consecutive months.

In his income tax return for the taxable year ended…