Legal Opinion

Gray v. Commissioner

United States Tax Court

Decided October 30, 1978No. Docket No. 5402-77Published

Petitioner entered into leases and management contracts for certain lands pursuant to which petitioner was required to pay in advance a fixed rental and management fee for the first year. Petitioner had the option to terminate the arrangement and obtain a refund of the amounts prepaid after the third year. By agreement of the parties, this right was accelerated and the contracts were terminated.

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Petitioner entered into leases and management contracts for certain lands pursuant to which petitioner was required to pay in advance a fixed rental and management fee for the first year. Petitioner had the option to terminate the arrangement and obtain a refund of the amounts prepaid after the third year. By agreement of the parties, this right was accelerated and the contracts were terminated. Held: Repayment to the petitioner of the advance rents and management fees did not constitute amounts received in exchange for such leases within the meaning of sec. 1241. Since the prepaid rents and…

1Opinion of the Court

Arthur J. Gray and Esther Gray, Petitioners v. Commissioner of Internal Revenue, Respondent

Gray v. Commissioner

Docket No. 5402-77

United States Tax Court

71 T.C. 95; 1978 U.S. Tax Ct. LEXIS 39;

October 30, 1978, Filed

Decision will be entered under Rule 155.

Petitioner entered into leases and management contracts for certain lands pursuant to which petitioner was required to pay in advance a fixed rental and management fee for the first year. Petitioner had the option to terminate the arrangement and obtain a refund of the amounts prepaid after the third year. By agreement of the parties, this…

2Cases cited11 opinions

  1. Canelo v. CommissionerUnited States Tax Court · 1969
  2. Louis Spitalny and Betty Spitalny, His Wife v. United States of America, William Erdwurm and Bart F. Erdwurm, His Wife v. United StatesCourt of Appeals for the Ninth Circuit · 1970
  3. Commissioner of Internal Revenue v. D. B. AndersCourt of Appeals for the Tenth Circuit · 1969
  4. National Bank of Commerce v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1940
  5. Kingsbury v. CommissionerUnited States Tax Court · 1976

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