Fox v. Commissioner
United States Tax Court
During the years 1977 through 1980, petitioner engaged in three sets of essentially offsetting options transactions which established spread positions. The options were tied to specific Treasury bills and were traded in a specialized over-the-counter market maintained by one brokerage firm.
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During the years 1977 through 1980, petitioner engaged in three sets of essentially offsetting options transactions which established spread positions. The options were tied to specific Treasury bills and were traded in a specialized over-the-counter market maintained by one brokerage firm. Over the 4 years, petitioner sustained net economic losses of $ 2,624 but claimed ordinary losses of $ 137,503. Held, petitioner's claimed losses did not arise from transactions entered into primarily for profit and therefore are not deductible under sec. 165(c)(2), I.R.C. 1954. Held, further, petitioner's…
1Opinion of the Court
Nims, Judge:
Respondent determined deficiencies in petitioners’ Federal income tax as follows:
Year Deficiency
1977. $19,629
1978. 3,906
1979. 18,236
After concessions, the sole issue remaining for decision is whether petitioners are entitled to deduct certain losses under section 165(c)(2).1 These losses were realized on the disposition of purchased put options tied to specific U.S. Treasury bills (Treasury bills). The options positions in each instance represented half of so-called vertical put spread positions held by petitioners straddling the years in issue and 1980.
FINDINGS OF FACT
Some of the…
2Cases cited22 opinions
- Helvering v. National Grocery Co.Supreme Court of the United States · 1938
- Golanty v. CommissionerUnited States Tax Court · 1979
- Commissioner v. BrownSupreme Court of the United States · 1965
- Malat v. RiddellSupreme Court of the United States · 1966
- Engdahl v. CommissionerUnited States Tax Court · 1979
17 more not listed; retrieve them via the Exa API.
3Cited by106 opinions
- Freytag v. CommissionerUnited States Tax Court · 1987
- Rose v. CommissionerUnited States Tax Court · 1987
- Estate of Baron v. CommissionerUnited States Tax Court · 1984
- Glass v. CommissionerUnited States Tax Court · 1986
- Cherin v. CommissionerUnited States Tax Court · 1987
101 more not listed; retrieve them via the Exa API.