Legal Opinion

Estate of Ratliff v. Commissioner

United States Tax Court

Decided September 30, 1993No. Docket No. 16017-91Published

P extended interest-bearing loans repayable in monthly installments over 15 years. The notes evidencing the loans provided that all installments were to be applied to principal until principal was fully paid and thereafter to interest. Held, the provisions of the notes do not, as a matter of law, control the allocation of the payments for income tax purposes.

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P extended interest-bearing loans repayable in monthly installments over 15 years. The notes evidencing the loans provided that all installments were to be applied to principal until principal was fully paid and thereafter to interest. Held, the provisions of the notes do not, as a matter of law, control the allocation of the payments for income tax purposes. Held, further, P's motion for summary judgment raises factual questions as to whether the notes reflected bona fide, arm's-length arrangements and the extent to which sec. 446, I.R.C., applies and, accordingly, is denied.

1Opinion of the Court

Estate of Harry W. Ratliff, Deceased, the First National Bank and Trust Company, Vinita, Oklahoma, Personal Representative, Petitioner v. Commissioner of Internal Revenue, Respondent

Estate of Ratliff v. Commissioner

Docket No. 16017-91

United States Tax Court

101 T.C. 276; 1993 U.S. Tax Ct. LEXIS 59; 101 T.C. No. 18;

September 30, 1993, Filed

An appropriate order will be issued denying petitioner's motion for summary judgment.

P extended interest-bearing loans repayable in monthly installments over 15 years. The notes evidencing the loans provided that all installments were to be applied to…

2Cases cited28 opinions

  1. Thor Power Tool Co. v. CommissionerSupreme Court of the United States · 1979
  2. Sandor v. CommissionerUnited States Tax Court · 1974
  3. Andrew A. Sandor and Jeanne Sandor v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1976
  4. Estate of Gerald L. Wallace, Deceased, Celia A. Wallace, and Celia A. Wallace v. Commissioner of Internal RevenueCourt of Appeals for the Eleventh Circuit · 1992
  5. Baird v. CommissionerUnited States Tax Court · 1977

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