Haass v. Commissioner
United States Tax Court
Petitioners, subsequent to the completion of two gas wells on certain property, entered into an oral agreement to participate in the drilling venture on that property. Thereafter, but prior to the formal assignment to petitioners of their interest in the venture, three further wells were drilled.
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Petitioners, subsequent to the completion of two gas wells on certain property, entered into an oral agreement to participate in the drilling venture on that property. Thereafter, but prior to the formal assignment to petitioners of their interest in the venture, three further wells were drilled. Petitioners agreed to pay drilling costs of each well to the extent of 35 percent of the operator's drilling charge even though their interest in the venture was only fourteen forty-eighths (approximately 29.2 percent). The operator was to pay only 5 percent of the drilling costs even though it had a…
1Opinion of the Court
Scott, Judge:
Respondent determined a deficiency of $80,661.15 in petitioners’ income tax for the calendar year 1964.
The only issue for decision is whether petitioners are entitled to deductions for intangible drilling costs on five gas wells located in Erie County, Pa.
FINDINGS OF FACT
Certain facts have 'been stipulated and are found accordingly.
Petitioners are husband and wife whose legal residence at the time of the filing of the petition herein was Grosse Pointe Farms, Mich. Using a cash basis method of accounting petitioners filed a joint Federal income tax return for the calendar year…
2Cases cited3 opinions
- Ashby H. Canter and Florence G. Canter v. The United StatesUnited States Court of Claims · 1965
- Hedges v. CommissionerUnited States Tax Court · 1964
- Phillips v. United StatesDistrict Court, E.D. Texas · 1964
3Cited by36 opinions
- Standard Oil Co. v. CommissionerUnited States Tax Court · 1981
- Bernuth v. CommissionerUnited States Tax Court · 1971
- Bernuth v. CommissionerCourt of Appeals for the Second Circuit · 1972
- Standard Oil Co. v. CommissionerUnited States Tax Court · 1977
- Sun Co. & Subsidiaries v. CommissionerUnited States Tax Court · 1980
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