Clark Oil & Refining Corp. v. United States

REYNOLDS, Judge:

OPINION AND ORDER

This is a suit for refund of $185,431.-20 of federal income taxes which the plaintiff paid after the Commissioner of Internal Revenue disallowed a $322,500 deduction on the taxpayer’s federal income tax returns for the fiscal years of 1959 and 1960. The issue is whether the amounts paid by taxpayer in settlement of litigation, which involved the transfer of real estate, and attorneys’ fees were deductible as ordinary and necessary business expenses rather than nondeductible capital expenditures. I hold that the payments involved were nondeductible capital…