Howlett v. Commissioner
United States Tax Court
Various taxpayers entered into so-called option agreements with Johnson County Rentals, Inc. Each of the agreements was in reality a rental agreement coupled with an option to purchase.
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Various taxpayers entered into so-called option agreements with Johnson County Rentals, Inc. Each of the agreements was in reality a rental agreement coupled with an option to purchase. Held, taxpayers are not entitled to interest deductions in respect of properties covered by the agreements because they did not incur "indebtedness" within the meaning of sec. 163(a), I.R.C. 1954. Held, further, taxpayers in docket Nos. 5354-67 and 1117-68 have failed to prove that they were entitled to real estate tax deductions in respect of such properties.
1Opinion of the Court
FORRESTER, Judge:
In these consolidated proceedings respondent has determined deficiencies in petitioners’ income taxes as follows:
Petitioners Pocket No. Taxable year Deficiency
Sterling G. and Clara Howlett_ 5354 — 67 1963 1964 $233. 76 250. 78
Raymond P. and Phyllis B. Ascue- 1115-68 1963 1964 210. 34 228. 60
Daniel W. and Carole S. Cooley- 1116-68 1964 1965 1966 226. 80 212. 69 172. 31
N. Leon and Patricia A. Payne_ 1117-68 1963 1964 1965 249. 00 207. 35 217. 38
The question we must decide is whether petitioners are entitled to any deductions for asserted payments of interest and real estate…
2Cases cited4 opinions
- Gilman v. Commissioner of Internal RevenueCourt of Appeals for the Eighth Circuit · 1931
- Gilman v. CommissionerUnited States Board of Tax Appeals · 1930
- Williams v. CommissionerUnited States Tax Court · 1967
- George T. Williams and Marcia J. Williams v. Commissioner of Internal RevenueCourt of Appeals for the Sixth Circuit · 1968
3Cited by29 opinions
- Estate of Franklin v. CommissionerUnited States Tax Court · 1975
- Landry v. CommissionerUnited States Tax Court · 1986
- Midkiff v. CommissionerUnited States Tax Court · 1991
- Koch v. CommissionerUnited States Tax Court · 1976
- Milenbach v. CommissionerUnited States Tax Court · 1996
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