Pembroke v. Commissioner
United States Board of Tax Appeals
1. Commissions and legal fees incident to procuring a long-term lease of real estate should be deducted ratably over the life of the lease. 2. Bonus payment consisting of real estate received for executing a long-term lease constitutes income to the extent of its fair market value in the year in which received. 3. The entire amount of rent received in 1925 for a period beginning in 1925 and ending in 1926 constitutes income in 1925 to this taxpayer on a cash receipts and…
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1. Commissions and legal fees incident to procuring a long-term lease of real estate should be deducted ratably over the life of the lease. 2. Bonus payment consisting of real estate received for executing a long-term lease constitutes income to the extent of its fair market value in the year in which received. 3. The entire amount of rent received in 1925 for a period beginning in 1925 and ending in 1926 constitutes income in 1925 to this taxpayer on a cash receipts and disbursements basis.
1Opinion of the Court
OPINION.
Smith :
This proceeding is for the redetermination of a deficiency of $2,139.64 in the petitioner’s income tax for 1925. One issue, raised by the pleadings, is disposed of by the respondent’s admission that the petitioner’s income to the extent of $12,889.10 should be treated as earned income. The remaining issues for our determination relate to (a) the deductibility of commissions and legal fees paid to negotiate a 99-year lease upon real estate owned by the petitioner; (b) the amount of income received by the petitioner upon the execution of the lease; and (c) the extent to which the…
2Cited by9 opinions
- Alstores Realty Corp. v. CommissionerUnited States Tax Court · 1966
- Michigan Cent. R.R. v. CommissionerUnited States Board of Tax Appeals · 1933
- Crooks v. CommissionerUnited States Tax Court · 1989
- Stahl v. CommissionerUnited States Tax Court · 1987
- Wolkowitz v. CommissionerUnited States Tax Court · 1949
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