James Bros. Coal Co. v. Commissioner
United States Tax Court
The petitioner borrowed $ 164,683.61 from a bank for a period of 3 years, under an arrangement whereby the borrower's obligation to repay said principal sum and also its obligation to pay interest thereon of $ 27,172.99 computed at 5 1/2 percent per annum for the entire 3-year period, were evidenced by a single promissory note for $ 191,856.60, which was to be paid in 36 equal monthly installments of $ 5,329.35 each.
Read the full summary
The petitioner borrowed $ 164,683.61 from a bank for a period of 3 years, under an arrangement whereby the borrower's obligation to repay said principal sum and also its obligation to pay interest thereon of $ 27,172.99 computed at 5 1/2 percent per annum for the entire 3-year period, were evidenced by a single promissory note for $ 191,856.60, which was to be paid in 36 equal monthly installments of $ 5,329.35 each. Held, that the Commissioner did not err in computing the amount of the accrued and deductible interest on said promissory note for a portion of the taxable year involved, by…
1Opinion of the Court
OPINION
The issue here, as above stated, is whether the Commissioner erred in determining the amomit of interest which the petitioner, an accrual basis taxpayer, is entitled to accrue and deduct for the taxable year in respect of the promissory note involved. Eestated more specifically, the question is whether the Commissioner erred in computing the amount of such deductible interest by using the so-called straight-line method — rather than by using the sum of the months-digits method which petitioner used and contends should have been approved by the Commissioner.
1. The basic differences in…
2Cases cited5 opinions
- Schulde v. CommissionerSupreme Court of the United States · 1963
- Story v. LivingstonSupreme Court of the United States · 1839
- Higginbotham-Bailey-Logan Co. v. CommissionerUnited States Board of Tax Appeals · 1927
- United States Playing Card Co. v. CommissionerUnited States Board of Tax Appeals · 1929
- Jemison v. CommissionerUnited States Board of Tax Appeals · 1929
3Cited by17 opinions
- Goodwin v. CommissionerUnited States Tax Court · 1980
- Prabel v. CommissionerUnited States Tax Court · 1988
- Rubnitz v. CommissionerUnited States Tax Court · 1977
- Lay v. CommissionerUnited States Tax Court · 1977
- Arrowhead Mt. Getaway v. CommissionerUnited States Tax Court · 1995
12 more not listed; retrieve them via the Exa API.