Airport Bldg. Development Corp. v. Commissioner
United States Tax Court
Petitioner made improvements to a building he had placed on leased land with a 10-year remaining term in order to sublease the property to the United States for use of an agency new to the Los Angeles area. The fixed term of the sublease was 5 years with right of the United States to renew for an additional 5-year term and during the renewal period to cancel the sublease on 180 days' notice.
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Petitioner made improvements to a building he had placed on leased land with a 10-year remaining term in order to sublease the property to the United States for use of an agency new to the Los Angeles area. The fixed term of the sublease was 5 years with right of the United States to renew for an additional 5-year term and during the renewal period to cancel the sublease on 180 days' notice. Held, the economic useful life of petitioner's leasehold improvements is the 10-year term of its lease of the land since petitioner has not shown that it was reasonably certain that it could not use the…
1Opinion of the Court
Scott, Judge:
Respondent determined deficiencies in petitioner’s Federal income tax for the years and in the amounts as follows:
Taxable year ended Amount
March 31, 1967_$21,921. 22
March 31, 1968_ 26, 606. 28
The issue for decision is whether the useful life of certain leasehold improvements for purposes of computing depreciation deductions is the 10-year remaining term of petitioner’s lease, or the lesser period based on the initial term of a sublease by petitioner of the premises.
FINDINGS OP PACT
Some of the facts have been stipulated and are found accordingly.
Petitioner, Airport Building…
2Cases cited6 opinions
- Massey Motors, Inc. v. United StatesSupreme Court of the United States · 1960
- Westinghouse Broadcasting Company, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the Third Circuit · 1962
- Westinghouse Broadcasting Co. v. CommissionerUnited States Tax Court · 1961
- New England Tank Industries, Inc. v. CommissionerUnited States Tax Court · 1968
- New England Tank Industries of New Hampshire, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the First Circuit · 1969
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- Ames v. CommissionerUnited States Tax Court · 1977
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