Batman Partnership Failed Tax Test

In 1951, a Texas couple named Ray L. and Edith Batman challenged the Commissioner of Internal Revenue, creating the curious federal case named Batman v. Commissioner. The dispute concerned Ray's claim that his farming and ranching business had formed a partnership with his 14-year-old son, Gerald, for the 1944 and 1945 tax years. The Tax Court found that Ray still controlled the business and that Gerald was not a genuine partner, so it upheld the couple's tax deficiencies. On May 22, 1951, the Fifth Circuit unanimously affirmed the ruling and called the arrangement a family tax-avoidance scheme disguised as a partnership.

Previous Fact Next Fact