Millinery Center Bldg. Corp. v. Commissioner
United States Tax Court
1. Petitioner purchased land which it had under lease for a period of 21 years for a consideration of $ 2,100,000. The fair market value of the land was $ 660,000, if it had been unimproved on the date of purchase. Petitioner claims that the remaining $ 1,440,000 was paid to secure the cancellation of a burdensome lease which had 21 years to run.
Read the full summary
1. Petitioner purchased land which it had under lease for a period of 21 years for a consideration of $ 2,100,000. The fair market value of the land was $ 660,000, if it had been unimproved on the date of purchase. Petitioner claims that the remaining $ 1,440,000 was paid to secure the cancellation of a burdensome lease which had 21 years to run. Petitioner claims deduction of the $ 1,440,000 which, it maintains, should be allocated to the cost of canceling the lease as an ordinary and necessary business expense under section 23 (a) of the Code. Held, the $ 1,440,000 is not deductible in the…
1Opinion of the Court
OPINION.
Black, Judge:
Petitioner states the issues raised by the pleadings, in its brief, as follows:
I
Is the petitioner entitled to deduct the amount of $1,500,000 or any part thereof incurred in connection with the cancellation of a burdensome lease as an ordinary and necessary expense under Section 23(a) or as a loss under Section 23(f) of the Internal Revenue Code? Or, in the alternative, is the petitioner entitled to amortize the said $1,500,000 or any part thereof incurred in obtaining a release from the burdensome 21 year lease over the remaining term of such lease?
II
In the further…
2Cases cited3 opinions
- Home Trust Co. v. Commissioner of Internal RevenueCourt of Appeals for the Eighth Circuit · 1933
- Cassatt v. Commissioner of Internal RevenueCourt of Appeals for the Third Circuit · 1943
- Cleveland Allerton Hotel v. Commissioner of Int. Rev.Court of Appeals for the Sixth Circuit · 1948
3Cited by11 opinions
- Millinery Center Building Corp. v. CommissionerSupreme Court of the United States · 1956
- World Publishing Company v. Commissioner of Internal RevenueCourt of Appeals for the Eighth Circuit · 1962
- Millinery Center Building Corporation v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1955
- Union Carbide Foreign Sales Corp. v. CommissionerUnited States Tax Court · 2000
- ABC Beverage Corp. & Subsidiaries v. United StatesDistrict Court, W.D. Michigan · 2008
6 more not listed; retrieve them via the Exa API.