John E. Leslie and Evelyn G. Leslie v. Commissioner of the Internal Revenue

J. JOSEPH SMITH, Circuit Judge:

The Commissioner of Internal Revenue appeals from a decision of the Tax Court, Charles R. Simpson, Judge, 50 T. C. No. 2. The decision allowed taxpayer, 1 a partner in Bache & Co., a brokerage firm, an interest deduction for federal income tax purposes in his return for the taxable year ending January 31, 1959, and held that no part of the firm’s indebtedness in the taxable year was incurred or continued “to purchase or carry” tax-exempt securities within the meaning of Section 265(2) Int.Rev.Code 1954, 26 U.S.C. § 265(2). We hold that the Commissioner was…