Charla Gates Cannon v. Commissioner of Internal Revenue

EBEL, Circuit Judge.

This case concerns a taxpayer who became involved in an unprofitable mining venture and deducted her distributive share of certain partnership losses on her income tax returns. The Commissioner of Internal Revenue disallowed these deductions, and the Tax Court upheld the Commissioner’s determinations. The taxpayer appeals, raising two issues. First, did the Tax Court correctly resolve the case on a theory not considered by either party, namely, section 183 losses? Second, did the Tax Court correctly conclude that the limited partnership did not incur the expenses at issue…