Eisenberg v. Commissioner
United States Tax Court
Held, petitioners' gain on the sale of a cruise ship in an in rem foreclosure proceeding in a Canadian court is taxable income in 1978, when the priorities of creditors were determined and the proceeds were distributed from the registry of the court for application on petitioners' liability, and not in 1977, when the foreclosure sale occurred.
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Held, petitioners' gain on the sale of a cruise ship in an in rem foreclosure proceeding in a Canadian court is taxable income in 1978, when the priorities of creditors were determined and the proceeds were distributed from the registry of the court for application on petitioners' liability, and not in 1977, when the foreclosure sale occurred. Held, further, petitioners are not entitled to a bad debt deduction under sec. 166, I.R.C. 1954, with respect to an amount allocated to petitioners from their wholly owned corporation pursuant to sec. 482, I.R.C. 1954, for 1974 and 1975. Held, further,…
1Opinion of the Court
Featherston, Judge:
Respondent determined deficiencies in the amounts of $29,880 and $400,495 in petitioners’ Federal income taxes for 1976 and 1977, respectively.
After concessions by both parties, the issues remaining for decision are:(1) Whether petitioners realized ordinary income under section 12451 due to the foreclosure of a mortgage on their cruise vessel, the Xanadu, in 1977; and(2) Whether petitioners are entitled to a bad debt deduction in the amount of $1,101,779 in either 1976 or 1977.
FINDINGS OF FACT
At the time the petition was filed, petitioners resided in Seattle, Wash. They…
2Cases cited20 opinions
- United States v. GeneresSupreme Court of the United States · 1972
- Helvering v. HammelSupreme Court of the United States · 1941
- Healy v. CommissionerSupreme Court of the United States · 1953
- Aero Rental v. CommissionerUnited States Tax Court · 1975
- Johnston v. CommissionerUnited States Tax Court · 1950
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3Cited by15 opinions
- Cox v. CommissionerCourt of Appeals for the Fifth Circuit · 1995
- Aizawa v. CommissionerUnited States Tax Court · 1992
- Lamm v. CommissionerCourt of Appeals for the Eighth Circuit · 1989
- Long v. CommissionerUnited States Tax Court · 1989
- Southeastern Mail Transport, Inc. v. CommissionerUnited States Tax Court · 1992
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