William O. Douglas

“ The fact that the construction we feel compelled to make favors the taxpayer on the cash basis and discriminates against the taxpayer on the accrual basis may suggest that changes in the law are desirable. ”

“ First, most corporations are on the accrual not the cash basis. Second, if an accrual taxpayer is limited in its deductions to excess profits taxes accrued within the taxable year, the provision has little value since there is 'rarely a case when a taxpayer would be liable for any excess profits tax in a year in which it has sustained a net operating loss * * *.' 108 F.Supp. ”

“ We take the other view and conclude that § 122 (d) (6) does not grant a taxpayer an option to take deductions on a basis that is inconsistent with the method of accounting which it employs.
Section 41 states the general rule that net income shall be computed 'in accordance with the method of accounting regularly employed in keeping the books' of the taxpayer. ”