Huey & Philip Hardware Co. v. Commissioner
United States Board of Tax Appeals
Petitioner and a realty corporation, owning and holding real estate which petitioner rented and used in its business, had substantially the same stockholders and officers, though there were some differences and the two corporations were operated as separate entities. , petitioner had loaned the realty company money in prior years and in 1934 took its demand promissory note secured by a second mortgage in settlement of its indebtedness.
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Petitioner and a realty corporation, owning and holding real estate which petitioner rented and used in its business, had substantially the same stockholders and officers, though there were some differences and the two corporations were operated as separate entities. , petitioner had loaned the realty company money in prior years and in 1934 took its demand promissory note secured by a second mortgage in settlement of its indebtedness. In November 1935, the realty company being in default, petitioner instituted foreclosure proceedings and petitioner purchased the property at foreclosure sale…
1Opinion of the Court
*786OPINION.
Black :
The only issue involved in this proceeding is whether petitioner is entitled to a deduction for a bad debt which it alleges it ascertained to be worthless and charged off during the taxable year. There is no issue as to the amount of the debt or that it was charged off during the taxable year. Petitioner originally claimed $53,741.15 as the amount of the bad debt, but now concedes that this figure should be reduced to $49,504.72.
The respondent has denied the deduction on two grounds: First, that the purchase of the real estate at foreclosure sale by the hardware company and its…
2Cases cited2 opinions
- Pinellas Ice & Cold Storage Co. v. CommissionerSupreme Court of the United States · 1933
- Helvering v. Midland Mutual Life InsuranceSupreme Court of the United States · 1937
3Cited by3 opinions
- Aaron W. Hardwick v. CommissionerUnited States Tax Court · 1947
- Huey & Philip Hardware Co. v. CommissionerUnited States Board of Tax Appeals · 1939
- Korth v. Zion's Savings Bank & Trust Co.Court of Appeals for the Tenth Circuit · 1945