High Plains Agricultural Credit Corp. v. Commissioner
United States Tax Court
Petitioner transferred to a bank with recourse loans made to ranchers and farmers. Held, under sec. 166(g)(2), petitioner, an endorser and a guarantor within the language of that provision, is prohibited from deducting additions to a reserve for bad debts to reflect the loans transferred.
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Petitioner transferred to a bank with recourse loans made to ranchers and farmers. Held, under sec. 166(g)(2), petitioner, an endorser and a guarantor within the language of that provision, is prohibited from deducting additions to a reserve for bad debts to reflect the loans transferred. Held, further, the Commissioner did not abuse his discretion when he determined that, with regard to loans not transferred, no deduction for additions to a reserve was reasonable in the taxable years.
1Opinion of the Court
OPINION
Tietjens, Judge:
The Commissioner determined the following deficiencies in petitioner’s income tax:
TYESept. 30— Deficiency
1967 _ $2,107.76
1968 _ 5,868.36
1969 _ 16,050.93
The questions for decision are: (1) Whether section 166(g)1 allows petitioner to deduct additions to a reserve for bad debts when those additions reflect loans and notes transferred with recourse to a bank; and (2) whether the Commissioner abused his discretion when he determined that, with regard to loans retained, no deduction for an addition to the petitioner’s reserve was reasonable in the taxable years ended…
2Cases cited32 opinions
- Shapiro v. ThompsonSupreme Court of the United States · 1969
- Bolling v. SharpeSupreme Court of the United States · 1954
- Frontiero v. RichardsonSupreme Court of the United States · 1973
- Brushaber v. Union Pacific RailroadSupreme Court of the United States · 1916
- Kahn v. ShevinSupreme Court of the United States · 1974
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3Cited by9 opinions
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- Ditunno v. CommissionerUnited States Tax Court · 1983
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- Gajewski v. CommissionerUnited States Tax Court · 1985
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