In the case of Burnet, Commissioner of Internal Revenue v. Guggenheim in 1932, the U.S Supreme Court ruled on a dispute regarding federal income tax law. The issue at hand was whether or not money received from selling mining rights could be considered capital gains (which would be taxed less) instead of ordinary income. Daniel Guggenheim had sold his rights to several mines and claimed that this should count as capital gain on his taxes for those years. However, the IRS disagreed with him and argued that it should be classified as ordinary income which is subject to higher taxation rates. The court sided with the IRS in a 5-4 decision stating that since Mr.Guggenheim did not sell any physical property but only contractual rights to minerals yet unextracted from land he still owned, these proceeds were taxable as regular income rather than capital gains. This ruling clarified how transactions involving mineral extraction are treated under tax law.

In the dissenting opinion for Burnet v. Guggenheim, Justice Stone argued that the majority's interpretation of Section 202(c) of the Revenue Act was incorrect and inconsistent with its language and purpose. He believed that this section should be interpreted to allow a deduction from gross income for estate taxes paid on property transferred at death, regardless of whether it had been previously taxed as a gift during life. According to him, there was no clear indication in the statute or legislative history suggesting an intent by Congress to impose double taxation on such transfers. Furthermore, he pointed out inconsistencies in how similar provisions were being applied under different sections of tax law due to varying interpretations by courts and administrative agencies. Thus, he disagreed with denying taxpayers relief from double taxation when their gifts become subject to estate tax upon their death.