Smith v. Commissioner
United States Tax Court
Petitioner and a partnership of which he was a partner executed an "Assumption of Liability," by which petitioner purported to assume the obligation to pay principal and interest on a nonrecourse note executed by the partnership and secured by a deed of trust on property of the partnership.
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Petitioner and a partnership of which he was a partner executed an "Assumption of Liability," by which petitioner purported to assume the obligation to pay principal and interest on a nonrecourse note executed by the partnership and secured by a deed of trust on property of the partnership. Thereafter, the partners exchanged their partnership interests for shares in a corporation in an exchange qualifying under sec. 351, I.R.C. 1954, the corporation assuming the partnership obligation to which the note was subordinated. Held: 1. Payments made by petitioner after the incorporation transaction,…
1Opinion of the Court
OPINION
Tannenwald, Judge:
Respondent determined the following deficiencies in and additions to petitioner’s Federal income taxes:
Taxable year Deficiency Addition to tax sec. 6653(a)1
1976 $57,573.70 $2,878.69
1977 95.897.50 4,794.88
1978 373,930.89 18,696.54
The issues for decision are (1) whether petitioner may deduct as interest his payments made during 1978 with respect to a promissory note, and (2) whether petitioner must recognize gain on a series of transactions during 1978 culminating in the transfer of a partnership interest in exchange for stock in a controlled corporation.2
The case was…
2Cases cited41 opinions
- Deputy, Administratrix v. Du PontSupreme Court of the United States · 1940
- Commissioner v. TuftsSupreme Court of the United States · 1983
- Southern Pacific Transp. Co. v. CommissionerUnited States Tax Court · 1980
- Dean v. CommissionerUnited States Tax Court · 1984
- Hynes v. CommissionerUnited States Tax Court · 1980
36 more not listed; retrieve them via the Exa API.
3Cited by44 opinions
- Abramson v. CommissionerUnited States Tax Court · 1986
- Gefen v. CommissionerUnited States Tax Court · 1986
- Coleman v. CommissionerUnited States Tax Court · 1986
- Smith v. CommissionerUnited States Tax Court · 1988
- Melvin v. CommissionerUnited States Tax Court · 1987
39 more not listed; retrieve them via the Exa API.