Otey v. Commissioner
United States Tax Court
Petitioner formed a partnership with one Thurman to construct FHA-financed housing on property owned by petitioner. Pursuant to the partnership agreement, petitioner would contribute the property to the partnership at an agreed value of $ 65,000, and an FHA-insured construction loan would be taken out in an amount greater than needed for the construction, of which petitioner would draw $ 65,000. Partnership profits and losses would thereafter be shared equally.
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Petitioner formed a partnership with one Thurman to construct FHA-financed housing on property owned by petitioner. Pursuant to the partnership agreement, petitioner would contribute the property to the partnership at an agreed value of $ 65,000, and an FHA-insured construction loan would be taken out in an amount greater than needed for the construction, of which petitioner would draw $ 65,000. Partnership profits and losses would thereafter be shared equally. Thurman contributed no capital, but his credit was essential to obtain the loan. Held, petitioner's transfer to the partnership of…
1Opinion of the Court
John H. Otey, Jr., and Bettye G. Otey, Petitioners v. Commissioner of Internal Revenue, Respondent
Otey v. Commissioner
Docket No. 1203-76
United States Tax Court
70 T.C. 312; 1978 U.S. Tax Ct. LEXIS 116;
May 23, 1978, Filed
Decision will be entered under Rule 155.
Petitioner formed a partnership with one Thurman to construct FHA-financed housing on property owned by petitioner. Pursuant to the partnership agreement, petitioner would contribute the property to the partnership at an agreed value of $ 65,000, and an FHA-insured construction loan would be taken out in an amount greater than needed for…
2Cases cited3 opinions
- Otey v. CommissionerUnited States Tax Court · 1978
- Davis v. CommissionerUnited States Tax Court · 1970
- Oliver v. CommissionerUnited States Tax Court · 1954