William H. Zuhone, Jr. And Audra M. Zuhone v. Commissioner of Internal Revenue

CUMMINGS, Circuit Judge.

Petitioners William H. Zuhone, Jr. and his wife Audra have appealed from a decision of the Tax Court holding that there was a deficiency in income tax amounting to $467,746.91 for 1975 (App. A15). The Tax Court held that certain overriding royalty interests in oil and gas wells must be included in petitioners’ 1975 and 1976 taxable income 1 and also accepted the evaluation of those interests supplied by the Commissioner’s expert. The propriety of these two rulings is now before us. 2 We affirm.

I. Propriety of Income Tax Treatment of Taxpayer’s Royalty Interests

When…