Siple v. Commissioner
United States Tax Court
In implementation of an agreement with a corporation and its majority stockholder to purchase stock in the corporation and otherwise to help it financially, petitioners furnished collateral so that the corporation could borrow from the bank with no personal liability on the part of petitioners.
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In implementation of an agreement with a corporation and its majority stockholder to purchase stock in the corporation and otherwise to help it financially, petitioners furnished collateral so that the corporation could borrow from the bank with no personal liability on the part of petitioners. The corporation suffered financial reverses and, as part of an agreement severing all business relations with the corporation and its majority stockholder, petitioners waived or released any rights they had, or might subsequently acquire, against either of them. Petitioners subsequently paid the bank…
1Dissent
SteREEtt, /.,
dissenting: Petitioner Meredith Siple paid the First National Bank of Nevada $150,000 in 1963 and $145,000 in 1964 and deducted said payments as ordinary losses on his tax returns for those years. We must consider why such payments were made to determine whether this asserted tax treatment was correct.
The payments were made after the bank stated in writing to petitioner that “Demand is made upon you in accordance with the indemnity agreement you signed on October 22, 1959.” Pursuant solely to this demand the payments in question were made.
It then becomes appropriate to consider…
2Cases cited9 opinions
- Putnam v. CommissionerSupreme Court of the United States · 1956
- Arrowsmith v. CommissionerSupreme Court of the United States · 1952
- Howell v. Commissioner of Internal RevenueCourt of Appeals for the Eighth Circuit · 1934
- Shea v. CommissionerUnited States Tax Court · 1961
- Wells v. Mayor of SavannahSupreme Court of Georgia · 1891
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