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No longer can we have recourse to any fund of business experience, to any known businesspractice. Men do at times pay the debts of others without legal obligation or the lighter obligationimposed by the usages of trade or by neighborly amenities, but they do not do so ordinarily, noteven though the result might be to heighten their reputation for generosity and opulence. Indeed, iflanguage is to be read in its natural and common meaning (Old Colony R. Co. v. Commissioner, 284 U. S. 552, 560, 52 S. Ct. 211, 76 L. Ed. 484; Woolford Realty Co. v. Rose, 286 U. S.319, 327, 52 S. Ct. 568, 76 L. Ed. 1128), we should have to say that payment in suchcircumstances, instead of being ordinary is in a high degree extraordinary. There is nothingordinary in the stimulus evoking it, and none in the response. Here, indeed, as so often in otherbranches of the law, the decisive distinctions are those of degree and not of kind. One struggles invain for any verbal formula that will supply a ready touchstone. The standard set up by the statuteis not a rule of law; it is rather a way of life. Life in all its fullness must supply the answer to theriddle.The Commissioner of Internal Revenue resorted to that standard in assessing the petitioner'sincome, and found that the payments in controversy came closer to capital outlays than to ordinary
5/5/2018Checkpoint | Documentand necessary expenses in the operation of a business. His ruling has the support of apresumption of correctness, and the petitioner has the burden of proving it to be wrong. Wickwire v.Reinecke, 275 U. S. 101, 48 S. Ct. 43, 72 L. Ed. 184; Jones v. Commissioner (C. C. A.) 38 F. (2d) 550, 552. Unless we can say from facts within our knowledge that these are ordinary andnecessary expenses according to the ways of conduct and the forms of speech prevailing in thebusiness world, the tax must be confirmed. But nothing told us by this record or within the sphere ofour judicial notice permits us to give that extension to what is ordinary and necessary. Indeed, to doso would open the door to many bizarre analogies. One man has a family name that is clouded bythefts committed by an ancestor. To add to this own standing he repays the stolen money, wipingoff, it may be, his income for the year. The payments figure in his tax return as ordinary expenses.Another man conceives the notion that he will be able to practice his vocation with greater easeand profit if he has an opportunity to enrich his culture. Forthwith the price of his educationbecomes an expense of the business, reducing the income subject to taxation. There is littledifference between these expenses and those in controversy here. Reputation and learning areakin to capital assets, like the good will of an old partnership. Cf. Colony Coal & Coke Corp. v.