Searles Real Estate Trust v. Commissioner
United States Board of Tax Appeals
1. ALLOCATION OF COSTS. The petitioner acquired two tracts of land in 1922 for an aggregate purchase price and did not allocate to the respective tracts of land their proportional part of the cost. Immediately after acquirement of the two tracts, petitioner subdivided one of the tracts into town lots and after improving them put them on sale and during the taxable years sold many of them.
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1. ALLOCATION OF COSTS. The petitioner acquired two tracts of land in 1922 for an aggregate purchase price and did not allocate to the respective tracts of land their proportional part of the cost. Immediately after acquirement of the two tracts, petitioner subdivided one of the tracts into town lots and after improving them put them on sale and during the taxable years sold many of them. Held, the aggregate cost of the two tracts should be apportioned in accordance with their respective values at the time of purchase and the profits on the lots sold should be computed accordingly. 2. BAD…
1Opinion of the Court
OPINION.
Black:
In this proceeding the petitioner seeks a redetermination of its income-tax liability for the years 1922 and 1923, for which years the respondent has determined deficiencies of $3,259.80 and $3,558.81, respectively, and has also asserted a 25 per cent delinquency penalty for each of the years in the respective amounts of $814.95 and $889.70.
*1116The petitioner, in its original petition and by amendment, assigned errors which it designated A, B, C, D, E, F, G and H. All have been abandoned except G, E, F and G, which are as follows:
C. In allocation of total purchase price paid for…
2Cases cited3 opinions
- United States v. AndersonSupreme Court of the United States · 1926
- Hecht v. MalleySupreme Court of the United States · 1924
- Aluminum Castings Co. v. RoutzahnSupreme Court of the United States · 1930
3Cited by12 opinions
- Heiner v. MellonSupreme Court of the United States · 1938
- Maytag v. CommissionerUnited States Tax Court · 1959
- District Bond Co. v. CommissionerCourt of Appeals for the Ninth Circuit · 1940
- Tiscornia v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1938
- Buscaglia v. Tribunal de Contribuciones de Puerto RicoSupreme Court of Puerto Rico · 1945
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