Kaye v. Commissioner
United States Tax Court
Interest Deductions. -- Transactions whereby each principal petitioner purported to purchase with borrowed funds time deposit certificates in the principal amount of $ 687,500, but received no money or economic benefit except contemplated tax savings from interest deductions, held, shams; there were not in substance borrowings totaling $ 687,500; and interest paid on the purported loans at the rate of 10 per cent per annum is not deductible.
1Opinion of the Court
OPINION.
Harron, Judge:
The respondent determined deficiencies in income tax for the taxable year 1952 as follows:
DochetNo. Petitioners Deficiencies
64451 Danny Kaye and Sylvia Kaye_ $19,667.66
64452 Oy Howard_ 33,452.93
Each deficiency results from the respondent’s disallowance of a deduction for payment of alleged interest in 1952. The amount deducted as interest by Sylvia Kaye is $23,750. The amount deducted as interest by Cy Howard is $38,750. Each petitioner individually entered into a series of separate transactions with the same broker which purported to be for the purchase, on margin, of…
2Cases cited12 opinions
- Gregory v. HelveringSupreme Court of the United States · 1935
- Deputy, Administratrix v. Du PontSupreme Court of the United States · 1940
- Old Colony Railroad v. CommissionerSupreme Court of the United States · 1932
- Doyle v. Mitchell Brothers Co.Supreme Court of the United States · 1918
- Eli D. Goodstein v. Commissioner of Internal Revenue, Commissioner of Internal Revenue v. Eli D. GoodsteinCourt of Appeals for the First Circuit · 1959
7 more not listed; retrieve them via the Exa API.
3Cited by34 opinions
- Albert Gordon MacRae and Sheila MacRae v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1961
- Bridges v. CommissionerUnited States Tax Court · 1963
- MacRae v. CommissionerUnited States Tax Court · 1960
- Danny Kaye and Sylvia Kaye v. Commissioner of Internal Revenue, Cy Howard v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1961
- Leslie H. Jockmus and Esther N. Jockmus v. United StatesCourt of Appeals for the Second Circuit · 1964
29 more not listed; retrieve them via the Exa API.