In the United States v. International Building Co., 1952, the Supreme Court ruled on a dispute involving tax deductions for depreciation of property used in trade or business. The respondent, International Building Company (IBC), had purchased and leased properties to various tenants while claiming depreciation deductions on their federal income taxes. However, IBC did not maintain or repair these properties; instead, they passed this responsibility onto their lessees through net lease agreements. The Internal Revenue Service disallowed these deductions arguing that since IBC was not responsible for maintaining the buildings' physical condition nor bore any risk of loss due to wear and tear as per its leasing contracts with tenants, it could not claim such benefits under Section 23(l) of the Internal Revenue Code. The case reached the Supreme Court after conflicting decisions from lower courts - Tax court allowing such deduction but Sixth Circuit reversing it stating lessor must bear burden of wear and tear to claim depreciation. However, Justice Reed delivered majority opinion favoring IBC stating that even though maintenance responsibilities were transferred via leases yet ownership remained with them making them eligible for claiming depreciation under section 23(l). Henceforth setting precedent that owner can still depreciate an asset despite transferring upkeep responsibilities.

In the dissenting opinion for United States v. International Building Co., Justice Jackson disagreed with the majority's interpretation of Section 3466 of the Revised Statutes, which gives priority to debts owed by insolvent debtors to the United States. He argued that this statute should not apply in cases where a debtor has declared bankruptcy under Chapter X of the Bankruptcy Act because it contradicts Congress' intent when they passed this act. According to Justice Jackson, Congress intended for all creditors in these situations to be treated equally and fairly without giving any special privileges or priorities. Therefore, he believed that applying Section 3466 in such cases would undermine this purpose and lead to unfair outcomes for other creditors who are also trying to recover their debts from bankrupt companies.