Allen v. Commissioner
United States Tax Court
50 T.C. 466 (1968)
Richard Allen (plaintiff) was a baseball player. While Richard was in high school, he was scouted by John Ogden, a scout for the Philadelphia National League Club (the Phillies). As head of the family, Richard’s mother, Era, negotiated Richard’s contract with the Phillies. Era also signed Richard’s contract with the Phillies, as all professional baseball teams required consent from any player’s parent or guardian if the player was under the age of 21. Richard was 18 at the time that the contract was signed. The Phillies offered Richard a $70,000 signing bonus, to be paid over five years. Era, Richard, and the Phillies came to an agreement by which Era would be paid $40,000 of Richard’s bonus directly. Era reasoned that she took care of Richard and negotiated his contract and, therefore, should be compensated. The Phillies did not care where the money went and so agreed to direct a portion of the bonus to Era. On his income-tax return, Richard did not include the payments the Phillies made to Era as part of his gross income. The Commissioner of Internal Revenue (the Commissioner) (defendant) determined that Richard was deficient on his income-tax returns because Richard did not include his mother’s portion of the signing bonus in his taxable income. The Commissioner pointed to § 73 of the Internal Revenue Code to argue that all money received in relation to services performed by a minor—in this case, Richard—must be included in his income, even if the money was paid directly to the minor’s parent. Richard petitioned the United States Tax Court for a redetermination.
Rule of Law
Holding and Reasoning (Raum, J.)
What to do next…
Unlock this case brief with a free (no-commitment) trial membership of Quimbee.
You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 709,000 law students since 2011. Some law schools—such as Yale, Berkeley, and Northwestern—even subscribe directly to Quimbee for all their law students.Unlock this case briefRead our student testimonials
Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.
Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students.Learn about our approachRead more about Quimbee
Here's why 709,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 44,500 briefs, keyed to 983 casebooks. Top-notch customer support.
- The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
- Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
- Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.