In the case of Helvering v. Independent Life Ins. Co. (292 U.S. 371 (1934)), Independent owned a building. They rented out part of the building and used the rest of the building for themselves. The IRS wanted Independent to calculate how much money they could have made by renting out the part of the building they were using themselves, and pay taxes on it. However, the US Supreme Court found that the rental value of a building used by the owner does not constitute income within the meaning of the 16th Amendment.
  • Contrast this case to Dean v. Commissioner (187 F.2d 1019 (1951)). In Dean, Dean was living in a house owned by the corporation he owned. The Court found that since Dean was getting a benefit (free rent) from the corporation, the rental value of the home must be considered gross income, even though he owned the corporation.