Securities Mortg. Co. v. Commissioner
United States Tax Court
In 1966, P, which was in the mortgage loan business, foreclosed the mortgages which it held on two uncompleted apartment projects, and the properties were sold at sheriff's sales. At each sale, P bid the amount, or approximately the amount, of its claim against the debtor and acquired the property for such bid. In connection with one of the properties, the redemption rights did not expire until the succeeding year.
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In 1966, P, which was in the mortgage loan business, foreclosed the mortgages which it held on two uncompleted apartment projects, and the properties were sold at sheriff's sales. At each sale, P bid the amount, or approximately the amount, of its claim against the debtor and acquired the property for such bid. In connection with one of the properties, the redemption rights did not expire until the succeeding year. Held: 1. P was entitled to deduct both of its losses in 1966, even though the redemption rights in connection with one of the properties did not expire until the succeeding year;…
1Opinion of the Court
Simpson, Judge:
The respondent determined a deficiency of $175,620 in the petitioner’s Federal income tax for the year ending November 30,1966. The issues to be decided are whether a mortgagee may deduct its loss on the foreclosure of property in the year of the foreclosure sale or in the year in which the redemption rights expire, what burden is placed on the mortgagee to prove the fair market value of property acquired at the foreclosure sale, and what formula is to be used to determine the fair market value of an incomplete apartment project.
FINDINGS OF FACT
Some of the facts have been…
2Cases cited10 opinions
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- United States v. Joseph G. LeaseCourt of Appeals for the Second Circuit · 1965
- In Re Estate of Grace N. Williams, Deceased. Ralph E. Williams v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1958
- Hadley Falls Trust Co. v. United StatesCourt of Appeals for the First Circuit · 1940
- Hawkins v. CommissionerUnited States Board of Tax Appeals · 1936
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