Vancoh Realty Co. v. Commissioner
United States Board of Tax Appeals
1. Where a loan is extended, the principal of such extended loan including the unpaid balance of principal, representing in part cost and in part unrealized discount, and, in some instances, an increase in principal, the commission charged for the extension being added thereto or paid in cash, the unrealized discount, a part of the principal of the new loan, is income in the taxable year in which such extension is made, taxpayer's books being on the accrual basis. 2. Where…
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1. Where a loan is extended, the principal of such extended loan including the unpaid balance of principal, representing in part cost and in part unrealized discount, and, in some instances, an increase in principal, the commission charged for the extension being added thereto or paid in cash, the unrealized discount, a part of the principal of the new loan, is income in the taxable year in which such extension is made, taxpayer's books being on the accrual basis. 2. Where taxpayer purchased mortgage loans through brokers at a discount and kept its books on an accrual basis, only the amount…
1Opinion of the Court
*922OPINION.
McMahon:
It has been repeatedly held by the Board and the courts that where the books of a taxpayer, engaged in the business of making mortgage loans, are kept on a cash receipts and disbursements basis, discounts or commissions on such mortgage loans deducted from the principal o.f such loans at the time made constitute income in the year the notes secured by mortgage are either paid in full or sold. Cosmopolitan Bond & Mortgage Co., 30 B. T. A. 717, and cases relied on therein, dismissed on motion of the Commissioner, 77 Fed. (2d) 994; Commissioner v. Central Republic Trust Co., 75…
2Cited by9 opinions
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- Earl A. Phillips and Dorothy M. Phillips v. William E. Frank, District Director of Internal RevenueCourt of Appeals for the Ninth Circuit · 1961
- Darby Inv. Corp. v. CommissionerUnited States Tax Court · 1962
- Smith v. CommissionerUnited States Tax Court · 1967
- Rivers v. CommissionerUnited States Tax Court · 1968
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