Haley v. Commissioner
United States Tax Court
1. Deduction -- Operating Losses -- Cash Basis -- No Payments. -- A taxpayer using the cash receipts and disbursements basis has no right to deduct on his return an operating loss of a business, even though he managed that business, where an associate advanced all of the money lost in the unsuccessful operation of the business and the taxpayer gave his notes to his associate for one-half of the money advanced but never made any payment on the notes. 2. Gain or Loss --…
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1. Deduction -- Operating Losses -- Cash Basis -- No Payments. -- A taxpayer using the cash receipts and disbursements basis has no right to deduct on his return an operating loss of a business, even though he managed that business, where an associate advanced all of the money lost in the unsuccessful operation of the business and the taxpayer gave his notes to his associate for one-half of the money advanced but never made any payment on the notes. 2. Gain or Loss -- Exchange -- Property for Stock and Notes. -- The incorporation of a business did not result in any gain to the petitioner who…
1Opinion of the Court
OPINION.
MuRdock, Judge:
The petitioner claims that he is entitled, as sole proprietor of the business of Terra Ceia Bay Farms, to claim the entire amount of its losses in computing income on his joint returns and in carrying forward or carrying back the resulting net operating losses, and even if the operation is to be regarded as a joint venture, still he is entitled to use half of those losses for the same purposes. He does not contend that he was a partner with River in the business and their agreements expressly disavow any such relationship. The parties are agreed on the net results of…
2Cases cited2 opinions
- Cohan v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1930
- Page v. Rhode Island Hospital Trust Co.Court of Appeals for the First Circuit · 1937
3Cited by1 opinion
- Haley v. CommissionerUnited States Tax Court · 1951