Cavanagh v. Commissioner
United States Board of Tax Appeals
1. Held, under the facts, that taxpayer is not entitled to deduction for a bad debt or a loss from a transaction entered into for profit, where there has been no accounting with the debtor or ascertainment of the worthlessness of taxpayer's claim against the purported debtor, and no evidence that loss was sustained in the taxable year. 2. Taxpayer domiciled in California is required to list only one-half of his earnings when reporting income, inasmuch as the other one-half…
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1. Held, under the facts, that taxpayer is not entitled to deduction for a bad debt or a loss from a transaction entered into for profit, where there has been no accounting with the debtor or ascertainment of the worthlessness of taxpayer's claim against the purported debtor, and no evidence that loss was sustained in the taxable year. 2. Taxpayer domiciled in California is required to list only one-half of his earnings when reporting income, inasmuch as the other one-half is taxable to his wife, even though she is a nonresident alien, there having been no divorce or legal separation.
1Opinion of the Court
*1041OPINION.
KgRn:
Two issues are presented in this proceeding — (1) the question of a deduction for a “bad debt” and (2) whether petitioner must report his entire California income as his own.
On the first issue, in our findings of fact we have concluded that the transaction between the petitioner and Pauly was not a loan, but an investment on the part of petitioner. Although the petitioner testified that Pauly had asked for the money as a loan, it is apparent and admitted by the petitioner that the details and nature of the transaction are very hazy in his mind. In view of the written agreement…
2Cases cited9 opinions
- Poe v. SeabornSupreme Court of the United States · 1930
- United States v. RobbinsSupreme Court of the United States · 1926
- Hopkins v. BaconSupreme Court of the United States · 1930
- United States v. MalcolmSupreme Court of the United States · 1931
- Goodell v. KochSupreme Court of the United States · 1930
4 more not listed; retrieve them via the Exa API.
3Cited by20 opinions
- Bagur v. Comm'rUnited States Tax Court · 1976
- Mitchell v. CommissionerUnited States Tax Court · 1969
- Kimes v. CommissionerUnited States Tax Court · 1971
- Don Gilmore and Sue Gilmore v. United StatesUnited States Court of Claims · 1961
- Hampton v. CommissionerUnited States Tax Court · 1962
15 more not listed; retrieve them via the Exa API.