Martin v. Commissioner

OPINION.

Kern, Judge:

The question presented by this case concerns the propriety of a deduction of $1,000 taken by petitioners in each of the taxable years on account of the circumstances set forth in our findings of fact.

Eespondent contends that the payments made by petitioners to the unpaid materialmen and mechanics “resulted in losses instead of bad debts which, the petitioners, as individuals, may not deduct” under any provision of the Internal Eevenue Code1 and, in the alternative, that if the payments resulted in debts owned by petitioners they were valueless at the time of their creation…