In the case of Burnet, Commissioner of Internal Revenue v. Chicago Railway Equipment Company (1930), the U.S Supreme Court ruled on a matter concerning federal income tax law. The dispute arose when the Chicago Railway Equipment Company claimed deductions for losses incurred from selling assets at less than their depreciated value in its 1918 and 1919 tax returns. The Commissioner of Internal Revenue denied these claims, arguing that such losses could only be deducted if they were sustained during those taxable years as per Section 214(a)(5) of the Revenue Act of 1921. However, this provision was not present in earlier revenue acts applicable to those years. The court sided with the commissioner's interpretation by a majority decision, stating that unless explicitly provided by Congress, no deduction can be made for depreciation beyond what is allowed under existing laws at any given time period. Therefore, it held that taxpayers cannot claim additional deductions based on subsequent changes or amendments to taxation laws after filing their returns.

In the dissenting opinion for Burnet, Commissioner of Internal Revenue v. Chicago Railway Equipment Company, Justice Stone argued that the majority's decision was inconsistent with previous rulings and interpretations of tax law. He contended that a taxpayer should be allowed to deduct losses from their income in the year they were realized rather than when they were claimed or discovered. According to him, this interpretation would align more closely with economic realities and principles of fairness in taxation. Furthermore, he disagreed with the majority's view on how statutes of limitations should apply in such cases; instead advocating for a more flexible approach which takes into account individual circumstances and timing issues related to claiming deductions. Overall, his dissent emphasized an alternative understanding of tax laws based on practical considerations and equitable treatment.