Bennett v. Commissioner
United States Board of Tax Appeals
Petitioner J. M. Bennett, without consideration, delivered by endorsement certain notes to a trust created by him for the benefit of his children. The notes in question later became worthless. On the assumption that he was personally liable by reason of his endorsement, he substituted in lieu thereof securities having a cost basis in excess of the face amount of the notes taken up.
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Petitioner J. M. Bennett, without consideration, delivered by endorsement certain notes to a trust created by him for the benefit of his children. The notes in question later became worthless. On the assumption that he was personally liable by reason of his endorsement, he substituted in lieu thereof securities having a cost basis in excess of the face amount of the notes taken up. Held, as the trust was not a holder for value and there was no consideration for the endorsement, the worthless notes did not give rise to a bad debt deduction by petitioner; held, further, petitioners are not…
1Opinion of the Court
*747OPINION.
ARNOLD:
Petitioners assign as errors (a) the disallowance to each by the Commissioner of a deduction of $238.29 representing one-half of the payment made to the Standard Trust Co., trustee, for *748interest accrued on the Lane Taylor note, (b) the disallowance to each of a bad debt deduction of $16,748.67 representing one-half of the worthless notes of Casey and Taylor, (c) failure to allow an additional deduction of $9,867.33 each for loss on the Casey and Taylor notes, or, in the alternative, (d) failure to allow to each an additional deduction of $6,149.38 representing loss from the…
2Cases cited5 opinions
- Slacum v. PomerySupreme Court of the United States · 1810
- Texas Baptist University v. PattonCourt of Appeals of Texas · 1912
- De Hass v. DibertCourt of Appeals for the Third Circuit · 1895
- Farmers Savings Bank v. HansmannSupreme Court of Iowa · 1901
- Monroe v. State Bank of Patch GroveWisconsin Supreme Court · 1923
3Cited by7 opinions
- Union Carbide Corp. v. CommissionerUnited States Tax Court · 1980
- Woodward v. United StatesDistrict Court, N.D. Iowa · 1952
- Bennett v. CommissionerUnited States Board of Tax Appeals · 1939
- Day v. CommissionerUnited States Board of Tax Appeals · 1940
- Mather v. CommissionerUnited States Tax Court · 1944
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