Massachusetts Business Development Corp. v. Commissioner
United States Tax Court
T was incorporated in 1953 under a special act of the Massachusetts Legislature for the purpose of promoting the economy of the State by lending funds to businesses located in areas of underemployment that could not obtain financing from conventional sources.
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T was incorporated in 1953 under a special act of the Massachusetts Legislature for the purpose of promoting the economy of the State by lending funds to businesses located in areas of underemployment that could not obtain financing from conventional sources. From its inception through 1964, T made loans aggregating $ 34,812,000 and wrote off worthless debts in the net aggregate amount of $ 11,041. Its outstanding receivables at the close of 1960 were in the aggregate amount of $ 5,372,592 and its reserve for bad debts at that time was $ 293,991. Its receivables reached a level of $ 6,402,714…
1Opinion of the Court
OPINION
Raum, Judge:
This case involves the disallowance of petitioner’s deductions for additions to its bad debt reserve for each of the years 1961-64. An understanding of the background and general scope of the applicable statutory provisions is important to the proper application of those provisions to the facts before us.
Ordinarily, our tax laws do not allow any deductions in respect of reserves; it is only when losses actually occur that deductions therefor may be-taken. Brown v. Helvering, 291 U.S. 193. And as pointed out in Krim-Ko Corporation, 16 T.C. 31, 37, this was at one time true…
2Cases cited15 opinions
- Brown v. HelveringSupreme Court of the United States · 1934
- Krim-Ko Corp. v. CommissionerUnited States Tax Court · 1951
- United States v. Haskel Engineering & Supply CompanyCourt of Appeals for the Ninth Circuit · 1967
- Roanoke Vending Exchange, Inc. v. CommissionerUnited States Tax Court · 1963
- R. Gsell & Co., Inc. v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1961
10 more not listed; retrieve them via the Exa API.
3Cited by19 opinions
- Branerton Corp. v. CommissionerUnited States Tax Court · 1975
- Thor Power Tool Co. v. CommissionerUnited States Tax Court · 1975
- Valmont Industries, Inc. v. CommissionerUnited States Tax Court · 1980
- Atlantic Discount Company, Inc., Plaintiff-Appellee-Cross v. United States of America, Defendant-Appellant-CrossCourt of Appeals for the Fifth Circuit · 1973
- High Plains Agricultural Credit Corp. v. CommissionerUnited States Tax Court · 1974
14 more not listed; retrieve them via the Exa API.