Thomas v. Commissioner
United States Tax Court
Petitioners entered into a lease of certain property for 99 years at an annual rental of $ 15,000. At the time the lease was executed the property was being leased to another tenant for $ 12,000 a year, under a lease which had 5 years to run. The tenant was utilizing the premises for subleasing purposes only. Petitioners' lease was made subject to the terms of the existing lease, which lease was assigned to them together with all rents accruing therefrom.
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Petitioners entered into a lease of certain property for 99 years at an annual rental of $ 15,000. At the time the lease was executed the property was being leased to another tenant for $ 12,000 a year, under a lease which had 5 years to run. The tenant was utilizing the premises for subleasing purposes only. Petitioners' lease was made subject to the terms of the existing lease, which lease was assigned to them together with all rents accruing therefrom. Petitioners made two attempts to obtain the unexpired term of the existing lease, and also to secure other tenants. For each of the years…
1Opinion of the Court
Tietjens, Judge:
These proceedings involve the following deficiencies in income tax:
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The issue for decision is whether certain payments made by petitioners constituted deductible rent, or represented the cost of acquiring a lease. If the latter, they would be capital expenditures recoverable over the life of the lease.
Some of the facts were stipulated.
PINDINGS OP PACT.
The stipulated facts are so found, and are incorporated herein by this reference.
During the years in issue, petitioner Oscar L. Thomas was a realtor engaged in the business of negotiating commercial leases, and…
2Cases cited2 opinions
- Wolan v. Commissioner of Internal RevenueCourt of Appeals for the Tenth Circuit · 1950
- Southwestern Hotel Co. v. United StatesCourt of Appeals for the Fifth Circuit · 1940
3Cited by15 opinions
- University Properties, Inc. v. CommissionerUnited States Tax Court · 1966
- Weish Homes, Inc. v. CommissionerUnited States Tax Court · 1959
- Bellingham Cold Storage Co. v. CommissionerUnited States Tax Court · 1975
- Consolidated Foods Corp. v. CommissionerUnited States Tax Court · 1976
- Osterlund, Inc. v. CommissionerUnited States Tax Court · 1987
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