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Hertz Corp. v. United States, 364 U.S. 122 (1960)
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General SummaryThis case is from a collection containing the full text of over 16,000 Supreme Court cases from 1793 to the present. The body of Supreme Court decisions are, effectively, the final interpretation of the Constitution. Only an amendment to the Constitution can permanently overturn an interpretation and this has happened only four times in American history.
Hertz Corp. v. United States, 364 U.S. 122 (1960)
Hertz Corporation v. United States No. 283 Argued March 30, 1960 Decided June 27, 1960 364 U.S. 122
CERTIORARI TO THE UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
Syllabus
The Internal Revenue Code of 1954, § 167(b)(2), provides an accelerated method of depreciation, known as the "declining balance method" of computing depreciation deductions for income tax purposes; but § 167(c) limits the use of this method to property "with a useful life of 3 years or more." The applicable Treasury Regulation, § 1.167(b), issued in 1956, defines "useful life" as the "period over which the asset may reasonably be expected to be useful to the taxpayer in his trade or business," and § 1.167(b)-2 provides that "in no event shall an asset . . . be depreciated below a reasonable salvage value."
Held.
1. This regulation is valid, Massey Motors, Inc. v. United States, ante, p. 92, and the declining balance method may not be used in computing the depreciation on the passenger cars used by petitioner in its automobile rental business during the years 1954-1956, inclusive, since they were so used for less than three years. Pp. 123-124.
2. Since the trucks used in petitioner’s truck rental business were so used for more than three years, they were subject to depreciation under the "declining balance method"; but their salvage value at the time of disposition must be accounted for in the depreciation equation. Pp. 124-129.
(a) Having elected to compute depreciation on the "declining balance method" in connection with his returns for the years 1954-1956, inclusive, petitioner cannot abandon that method on the ground that it results in a retroactive application of a Treasury Regulation issued in 1956. Pp. 125-126.
(b) The provision of Treasury Regulation §1.167 (b)-2 that, "in no event shall an asset . . . be depreciated below a reasonable salvage value," is valid. Pp. 126-129.
268 F.2d 604, affirmed.
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Chicago: U.S. Supreme Court, "Syllabus," Hertz Corp. v. United States, 364 U.S. 122 (1960) in 364 U.S. 122 364 U.S. 123. Original Sources, accessed November 24, 2024, http://originalsources.com/Document.aspx?DocID=J75F6A45ZQ3FURT.
MLA: U.S. Supreme Court. "Syllabus." Hertz Corp. v. United States, 364 U.S. 122 (1960), in 364 U.S. 122, page 364 U.S. 123. Original Sources. 24 Nov. 2024. http://originalsources.com/Document.aspx?DocID=J75F6A45ZQ3FURT.
Harvard: U.S. Supreme Court, 'Syllabus' in Hertz Corp. v. United States, 364 U.S. 122 (1960). cited in 1960, 364 U.S. 122, pp.364 U.S. 123. Original Sources, retrieved 24 November 2024, from http://originalsources.com/Document.aspx?DocID=J75F6A45ZQ3FURT.
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