Vincent v. Commissioner
United States Tax Court
1. Section 23(a)(2) -- Section 23(e)(3) -- Costs of Litigation -- Recovery of Stock -- Collection of Income -- Allocation. -- Petitioner expended $ 174,445.58 for attorneys' fees and other litigation costs in connection with a suit to establish her title to stock in a corporation. Judgment was rendered in her favor. She recovered the stock, dividends, and interest.
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1. Section 23(a)(2) -- Section 23(e)(3) -- Costs of Litigation -- Recovery of Stock -- Collection of Income -- Allocation. -- Petitioner expended $ 174,445.58 for attorneys' fees and other litigation costs in connection with a suit to establish her title to stock in a corporation. Judgment was rendered in her favor. She recovered the stock, dividends, and interest. Held: (1) The portion of the litigation expense attributable to the collection of income is deductible under section 23 (a) (2), but the portion allocable to the recovery of stock forms part of the cost of the stock; (2) The…
1Opinion of the Court
OPINION.
Harron, Judge:
The petitioner claims that all of the expenses and costs of the litigation against Bear Film and others are deductible under section 23 (a) (2) of the Code as nonbusiness expenses. In the alternative, the petitioner claims deduction under section 23 (e) (3) on the theory that the expenses constitute a loss from theft or embezzlement.
The respondent contends that the primary purpose of the litigation was to establish that the equitable title to the Bear Film stock was owned by Oscar Hansen rather than by his mother and, later, by Albert Hansen; that the stock was impressed…
2Cases cited29 opinions
- Cohan v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1930
- Commissioner v. HeiningerSupreme Court of the United States · 1943
- Kornhauser v. United StatesSupreme Court of the United States · 1928
- Trust Under the Will of Bingham v. CommissionerSupreme Court of the United States · 1945
- McDonald v. CommissionerSupreme Court of the United States · 1944
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3Cited by22 opinions
- Kelly v. CommissionerUnited States Tax Court · 1955
- Western Products Co. v. CommissionerUnited States Tax Court · 1957
- Ruoff v. CommissionerUnited States Tax Court · 1958
- Graham v. CommissionerUnited States Tax Court · 1963
- Pennroad Corp. v. CommissionerUnited States Tax Court · 1954
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