TAXATION: Cream

Great was the to-do in 1933 when John Pierpont Morgan and his banking partners were discovered to have paid no income taxes for the years 1931 and 1932.* Franklin Roosevelt’s legislators were put to work and the next year, restricted in their use of capital losses, Morgan & Co. paid heavily. They paid, but they appealed, and in due time the Bureau of Internal Revenue ruled in their favor. Last week the Treasury announced their refunds, as follows:

J. P. Morgan $338,774.25

Thomas W. Lament 138,783.45

R. C. Leffingwell 80,254.53

Junius S. Morgan 45,231.73

George Whitney 44,587.25

Estate of Thomas Cochran 49,138.78

Estate of E. T. Stotesbury 147,675.21

Estate of Horatio G. Lloyd 49,019.31

Cream of the jest to these taxpayers was that, as is customary, they will receive not only their money back but interest on it at 6%—a lot bigger return than they could have got if they had invested in bonds.

*Celebrated during the inquisition of J. P. Morgan by Counsel (now New York Supreme Court Justice) Ferdinand Pecora, was a notation found on an income-tax return, made by an Internal Revenue agent, which read: “Returned without examination for the reason that the return was prepared in the office of J. P. Morgan & Co., and it has been our experience that any schedule made by that office is correct.”