DANIEL SCHULMANN, ET AL. VS. DIRECTOR, NEW JERSEY
DIVISION, NEW JERSEY DIVISION OF TAXATION
A-2089-10T3
The taxpayer used his personal funds to pay commissions
owed by two S corporations. He and his wife then deducted the
commission expenses from the S corporation income that they
reported on their personal income tax returns. Affirming the
reported opinion of the Tax Court, we held that the taxpayer
could not disregard the corporate form by taking personal
deductions for paying corporate obligations. The attempted
deductions also violated the rule against "cross-netting" of
losses, as set forth in N.J.S.A. 54A:5-2. 12-06-11
