Moore v. Commissioner
United States Tax Court
Petitioner inherited from her mother an interest in an income-producing building erected, prior to decedent's death, by the lessee at its expense. The lease extended beyond the useful life of the building. Held, petitioner had a basis for depreciation of the fair market value of the building at the time of her mother's death. J. Charles Pearson, Jr., 13 T. C. 851, followed.
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Petitioner inherited from her mother an interest in an income-producing building erected, prior to decedent's death, by the lessee at its expense. The lease extended beyond the useful life of the building. Held, petitioner had a basis for depreciation of the fair market value of the building at the time of her mother's death. J. Charles Pearson, Jr., 13 T. C. 851, followed. Held, further, that the right to receive rentals under a lease is an incident of fee ownership, and the favorable aspects of the lease did not make it a separate capital asset subject to amortization, nor increase the fair…
1Opinion of the Court
OPINION.
Rice, Judge:
The issue to be decided is whether petitioner should be allowed a deduction for depreciation on. the half interest in the building which she inherited from her mother. To be allowed a depreciation deduction under section 23 (1) of the Internal Revenue Code, the taxpayer must have an investment or depreciable interest in the property upon which he claims depreciation. Detroit Edison Co. v. Commissioner, 319 U. S. 98. Where the property for which depreciation is claimed has been placed upon the land by the lessee, the lessor generally is not allowed to deduct depreciation,…
2Cases cited3 opinions
- Detroit Edison Co. v. CommissionerSupreme Court of the United States · 1943
- Peters v. CommissionerUnited States Tax Court · 1945
- Pearson v. CommissionerUnited States Tax Court · 1949
3Cited by33 opinions
- Vaira v. CommissionerUnited States Tax Court · 1969
- Coleman v. CommissionerUnited States Tax Court · 1986
- Rowan v. CommissionerUnited States Tax Court · 1954
- Schubert v. CommissionerUnited States Tax Court · 1960
- Rosalie M. Schubert v. Commissioner of Internal RevenueCourt of Appeals for the Fourth Circuit · 1961
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