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Dietary supplement inventory shrinkage reduces cost of goods sold for tax purposes

The us_tax_courtUS Tax Court has held that when a dietary supplement manufacturer suffers "shrinkage" of inventory due to spoilage of supplements it may reduce its cost of goods sold, and its corresponding tax burden, by the value of the lost supplements.

TOTAL HEALTH CENTER TRUST, BONNIE STEJSKAL, TRUSTEE, ET AL. v.
COMMISSIONER OF INTERNAL REVENUE,
Docket Nos. 8793-05, 8794-05, Filed October 24, 2006.

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