Widener v. Commissioner
United States Board of Tax Appeals
1. The conduct of racing and breeding stables in the circumstances held a business and the expenses and losses are deductible. 2. Losses and depreciation of trust estate are not pro rata deductions of the distributees of trust income. 3. In determining the taxable net income of beneficiaries under a testamentary trust, the fact that the right, at the time of death, to receive such periodic distributions of income, had a value does not serve to reduce the taxable net income…
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1. The conduct of racing and breeding stables in the circumstances held a business and the expenses and losses are deductible. 2. Losses and depreciation of trust estate are not pro rata deductions of the distributees of trust income. 3. In determining the taxable net income of beneficiaries under a testamentary trust, the fact that the right, at the time of death, to receive such periodic distributions of income, had a value does not serve to reduce the taxable net income embodied in such distributions. Such distributions are income both under the statute and under the Constitution. 4. Such…
1Opinion of the Court
*657OPINION.
Sternhagen :
The first question to be answered is whether the activities of the petitioners in respect of their racing and breeding *658stables constituted a business. An affirmative answer carries with it the right to deduct the expenses of their operation1 and the losses sustained.2
The’ evidence establishes that the petitioners were engaged in the business of breeding, buying and selling race horses and entering them in racing contests for gain. They testified that they sought at all times to make a success of the enterprises and that their only measure of success was financial gain.…
2Cases cited7 opinions
- Eisner v. MacOmberSupreme Court of the United States · 1920
- Irwin v. GavitSupreme Court of the United States · 1925
- Chicago, Burlington & Quincy Railroad v. HarringtonSupreme Court of the United States · 1916
- Simpson v. United StatesSupreme Court of the United States · 1920
- Thacher v. LoweDistrict Court, S.D. New York · 1922
2 more not listed; retrieve them via the Exa API.
3Cited by42 opinions
- Margit Sigray Bessenyey v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1967
- Matilda M. Brooks v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1959
- Simms v. CommissionerUnited States Board of Tax Appeals · 1933
- Brooks v. CommissionerUnited States Tax Court · 1968
- Calaf Collazo v. Secretario de HaciendaSupreme Court of Puerto Rico · 1954
37 more not listed; retrieve them via the Exa API.