
    Oak Grove & Georgetown Railroad Co., Petitioner, v. Commissioner of Internal Revenue, Respondent.
    Docket No. 19023.
    Promulgated March 30, 1927.
    In determining whether the net income for 1923 is in excess of §25,000 and the credit of §2,000 provided for by section 236(b) of the Revenue Act of 1921 is to be allowed, the net loss provided for by section 204(b) may not be deducted.
    
      George E. H. Goodmer, Esq., for the petitioner.
    
      W. F. Gibbs, Esq., for the respondent.
    This is a proceeding for the redetermination of a deficiency in income tax for the calendar year 1923 in the amount of $250. The only question involved is whether for the purpose of the application of the statutory credit of $2.000 provided for in section 236 (b) of the Revenue Act of 1921 the net income for the taxable year should be determined by deducting the net loss for the previous year.
    
      BINDINGS OB BACT.
    The petitioner is an Alabama corporation engaged in the transportation of freight.
    The net income of the petitioner for the year 1923, before allowance for any loss under the provisions of section 204 of the Revenue Act of 1921, amounts to $44,512. The net loss for the year 1922 computed under section 204 of the Revenue Act of 1921 amounts to $31,920.01. The income subject to tax and on which the deficiency here involved was computed for the year 1923, after applying the net loss for the year 1922, amounts to $12,591.99.
    In computing the deficiency the respondent denied the petitioner the right to the specific credit of $2,000 provided for under section 236 (b) of the Revenue Act of 1921, on the ground that the net income of the petitioner for the year 1923 was in excess of $25,000.
   OPINION.

ARDNdbdl:

The question involved in this case has heretofore been decided adversely to the contentions of the petitioner in Appeals of American Varnish Co., 2 B. T. A. 201, and S. W. Bridges & Co., 4 B. T. A. 150, and Chicago Nut Co. v. Commissioner, 5 B. T. A. 614.

Judgment will be entered for the respondent.  