Commissioner of Internal Revenue v. Gracey

McCORD, Circuit Judge.

The Commissioner and the taxpayers have filed petitions for review of a decision of the Tax Court redetermining income tax deficiencies for the year 1940. The findings and opinion of the Tax Court are reported, 5 T.C. 296.

• During the taxable year, taxpayers were husband and wife residing in Texas, a community property State. Their income tax returns were filed on a community basis, and for the taxable year all their income and deductions represented community income and community deductions.

The Commissioner’s Petitions

Euleon Jock Gracey owned an oil well drilling rig…