Towne v. Eisner

Towne v. Eisner, 245 U.S. 418 (1918), is a United States Supreme Court case in which the Court held that "a stock dividend based on accumulated profits was not 'income' within the true intent of the statute."^[1] Congress passed a new law in reaction to Towne v. Eisner and so the case was soon overturned by the Supreme Court in Eisner v. Macomber.

Towne v. Eisner
Supreme Court of the United States
Argued December 12, 1917 Decided January 7, 1918
Full case name	Towne v. Eisner, Collector of United States Internal Revenue for the Third District of the State of New York
Citations	245 U.S. 418 (more) 38 S. Ct. 158; 62 L. Ed. 372; 1918 U.S. LEXIS 2143; 1 U.S. Tax Cas. (CCH) ¶ 14; 3 A.F.T.R. (P-H) 2959
Holding
A stock dividend based on accumulated profits is not "income."
Court membership
Chief Justice Edward D. White Associate Justices Joseph McKenna · Oliver W. Holmes Jr. William R. Day · Willis Van Devanter Mahlon Pitney · James C. McReynolds Louis Brandeis · John H. Clarke
Case opinions
Majority	Holmes, joined by White, Day, Van Devanter, Pitney, McReynolds, Brandeis, Clarke
Concurrence	McKenna
Overruled by
Eisner v. Macomber

It includes the quotable passage: "A word is not a crystal, transparent and unchanged; it is the skin of a living thought and may vary greatly in colour and content according to the circumstances and time in which it is used." ― Oliver Wendell Holmes Jr.^[2]