Brady v. Commissioner
United States Tax Court
Petitioner, and three other men who were engaged in the real estate business, jointly purchased 68 improved residential lots which were heavily encumbered with liens for delinquent taxes, settled and financed the removal of such liens, sold the lots to various purchasers, and divided the profits and expenses in equal shares.
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Petitioner, and three other men who were engaged in the real estate business, jointly purchased 68 improved residential lots which were heavily encumbered with liens for delinquent taxes, settled and financed the removal of such liens, sold the lots to various purchasers, and divided the profits and expenses in equal shares. Held, that petitioner and his associates were members of a joint venture; that the lots were held primarily for sale to customers in the ordinary course of the business of such venture and were not capital assets; and that petitioner's share of the net profits is taxable…
1Opinion of the Court
OPINION.
Pierce, Judge:
Respondent contends, as to the first issue, that petitioner’s one-fourth share of the profits here involved was derived from a joint venture for the purchase of the 68 improved residential lots, the removal of the large liens therefrom, and the sale of said lots to customers in the ordinary course of the business of the joint venture; and that such profits are taxable as ordinary income. Petitioner contends, on the other hand, that such profits are taxable as capital gains from sales of property held primarily for investment. We agree with the respondent.
Section 3797 (a)…
2Cases cited5 opinions
- MAULDIN v. COMMISSIONER OF INTERNAL REVENUE (Two Cases)Court of Appeals for the Tenth Circuit · 1952
- Mauldin v. CommissionerUnited States Tax Court · 1951
- West v. Peoples First National Bank & Trust Co.Supreme Court of Pennsylvania · 1954
- Wibbelsman v. CommissionerUnited States Tax Court · 1949
- United States Fidelity & Guaranty Co. ex rel. Reedy v. American Surety Co.District Court, M.D. Pennsylvania · 1938
3Cited by9 opinions
- Madison Gas & Electric Co. v. CommissionerUnited States Tax Court · 1979
- S & H, Inc. v. CommissionerUnited States Tax Court · 1982
- Guardian Indus. Corp. v. CommissionerUnited States Tax Court · 1991
- Robert A. Riddell v. Leon W. ScalesCourt of Appeals for the Ninth Circuit · 1969
- Brady v. CommissionerUnited States Tax Court · 1955
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