New England Tank Industries, Inc. v. Commissioner
United States Tax Court
Petitioner's predecessor contracted to furnish the U.S. Government with the use of oil storage facilities and related services. The contract originally specified a fixed annual payment for a 5-year firm period and gave the Government, in return for agreed payments, the options at any time to purchase the facilities and to terminate the contract for the convenience of the Government, and successive annual options during a 15-year period to renew the contract.
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Petitioner's predecessor contracted to furnish the U.S. Government with the use of oil storage facilities and related services. The contract originally specified a fixed annual payment for a 5-year firm period and gave the Government, in return for agreed payments, the options at any time to purchase the facilities and to terminate the contract for the convenience of the Government, and successive annual options during a 15-year period to renew the contract. When petitioner's predecessor encountered financing difficulty, the contract was modified to provide for substantial increased payments…
1Opinion of the Court
Tannenwald, Judge:
Respondent determined deficiencies in income tax as follows:
TYE Oct. SI— Deficiency
1960_$233,402. 59
1961_ 626, 556. 97
1962_ 46,007. 32
After concessions by the parties in regard to several items, the following issues remain for our consideration: (1) The tax treatment to be accorded $2 million paid to petitioner in the first year of its revised contract to provide the U.S. Government with certain oil storage facilities; and (2) the determination of the useful life of these facilities for depreciation purposes.
FINDINGS OF FACT
All of the facts have been stipulated. Those facts…
2Cases cited26 opinions
- Massey Motors, Inc. v. United StatesSupreme Court of the United States · 1960
- Schulde v. CommissionerSupreme Court of the United States · 1963
- Hertz Corp. v. United StatesSupreme Court of the United States · 1960
- Haggard v. CommissionerUnited States Tax Court · 1955
- D. M. Haggard and Nila Haggard v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1956
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3Cited by27 opinions
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- Adams v. CommissionerUnited States Tax Court · 1972
- Carland, Inc. v. CommissionerUnited States Tax Court · 1988
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