Salomon v. United States was a Supreme Court case that addressed the issue of corporate liability. The case involved a dispute between the United States and a corporation, Salomon, over the payment of taxes. The United States argued that Salomon was liable for the taxes, while Salomon argued that it was not liable because it was a separate legal entity from its shareholders. The Supreme Court held that Salomon was a separate legal entity from its shareholders and was therefore liable for the taxes. The Court reasoned that a corporation is a distinct legal entity from its shareholders and that the shareholders are not liable for the debts and obligations of the corporation. The Court also held that the shareholders of a corporation are not liable for the debts and obligations of the corporation, even if they are the sole owners of the corporation. The Court's decision in Salomon v. United States established the principle of corporate liability and established that corporations are separate legal entities from their shareholders. This decision has been cited in numerous subsequent cases and has been used to support the principle of limited liability for shareholders.

In Salomon v. United States, the Supreme Court was asked to decide whether a corporation could be held liable for taxes on income earned from its business operations. The majority opinion found that corporations are separate legal entities and can therefore be taxed as such. However, Justice Field dissented from this decision, arguing that corporations should not be treated differently than individuals when it comes to taxation because they do not have any of the rights or privileges of natural persons under the law. He argued that allowing corporate entities to escape taxation would create an unfair advantage over individual taxpayers who must pay their fair share of taxes in order to support government services and programs. Furthermore, he noted that Congress had never intended for corporations to enjoy special tax treatment since there were no laws specifically granting them such privilege at the time this case was decided.