Ingersoll v. Commissioner (A)
United States Tax Court
In 1935 petitioner orally guaranteed the mortgage note of a corporation the stock of which was owned by him and members of his family. Thereafter he advanced funds to the corporation for operation expenses. In 1940 the corporation went through a voluntary bankruptcy reorganization, which reduced its liability on the mortgage note but did not relieve petitioner from liability on his guaranty thereof.
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In 1935 petitioner orally guaranteed the mortgage note of a corporation the stock of which was owned by him and members of his family. Thereafter he advanced funds to the corporation for operation expenses. In 1940 the corporation went through a voluntary bankruptcy reorganization, which reduced its liability on the mortgage note but did not relieve petitioner from liability on his guaranty thereof. In 1941 petitioner was called upon to pay and did pay the balance due on the mortgage note. Held, the amount so paid is deductible in 1941 as a business loss.
1Opinion of the Court
OPINION.
Smith, Judge:
The respondent has determined a deficiency in petitioner’s income tax for 1941 in the amount of $8,139.85. The deficiency results for the most part from the disallowance of a deduction of $12,257.72 claimed by the petitioner in his return as a bad debt loss resulting from a payment which he made to a bank as guarantor of a note given by a family corporation.
Petitioner is an individual engaged in the practice of law, with offices in the Union Trust Building, Pittsburgh, Pennsylvania. He filed his income tax return on the cash basis for the taxable year 1941 with the…
2Cited by19 opinions
- Stamos v. CommissionerUnited States Tax Court · 1954
- Fox v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1951
- Siple v. CommissionerUnited States Tax Court · 1970
- Fox v. CommissionerUnited States Tax Court · 1950
- Aftergood v. CommissionerUnited States Tax Court · 1953
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