Chevy Chase Land Co. v. Commissioner
United States Tax Court
Held, upon the facts of this case, a landowner's costs of negotiating a prospective long-term lease of an unimproved tract of land and the costs (except for one item) of an unsuccessful attempt to have the land rezoned are deductible as an abandonment loss, upon termination of the lease transaction, which was contingent upon obtaining the rezoning.
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Held, upon the facts of this case, a landowner's costs of negotiating a prospective long-term lease of an unimproved tract of land and the costs (except for one item) of an unsuccessful attempt to have the land rezoned are deductible as an abandonment loss, upon termination of the lease transaction, which was contingent upon obtaining the rezoning. Sec. 165(a), I.R.C. 1954. Held, further, one of the component items of the rezoning effort, the cost of a topographical map of the land, may not be included as part of the abandonment loss, since it had continuing value as a useful asset in the…
1Opinion of the Court
Raum, Judge:
The Commissioner determined a deficiency in income tax for the year 1971 in the amount of $51,471.74 against petitioner Chevy Chase Land Co. of Montgomery County, Md. After concessions, the sole issue remaining for decision is whether a landowner’s costs of negotiating a prospective long-term lease of an unimproved tract of land and the costs of an unsuccessful attempt to have the land rezoned are deductible as an abandonment loss under section 165(a), I.R.C. 1954, upon termination of the lease transaction, which was contingent upon obtaining the rezoning.
FINDINGS OF FACT
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2Cases cited9 opinions
- Lucas v. American Code Co.Supreme Court of the United States · 1930
- Louisiana Land & Exploration Co. v. CommissionerUnited States Tax Court · 1946
- Louisiana Land & Exp. Co. v. Commissioner of Int. Rev.Court of Appeals for the Fifth Circuit · 1947
- Edward R. Godfrey and Georgia G. Godfrey v. Commissioner of Internal RevenueCourt of Appeals for the Sixth Circuit · 1964
- Galt v. Commissioner of Internal RevenueCourt of Appeals for the Seventh Circuit · 1954
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3Cited by5 opinions
- Chen v. Comm'rUnited States Tax Court · 2014
- Chevy Chase Land Co. v. CommissionerUnited States Tax Court · 1979
- Davis v. CommissionerUnited States Tax Court · 1983
- Hustead v. CommissionerUnited States Tax Court · 1994
- Maguire/Thomas Ptnrs. Fifth & Grand v. Comm'rUnited States Tax Court · 2005