Pollak v. Commissioner
United States Tax Court
Deduction -- Nonbusiness Bad Debt or Ordinary Loss -- Section 23 (k) (4) -- Section 23 (e) (2). -- The endorser of a corporation's notes who was required to pay the notes when the corporation became insolvent sustained a loss from the worthlessness of a nonbusiness debt rather than from a transaction entered into for profit where the corporation was solvent at the time the notes were endorsed but was insolvent though still in existence at the time payment was made under the…
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Deduction -- Nonbusiness Bad Debt or Ordinary Loss -- Section 23 (k) (4) -- Section 23 (e) (2). -- The endorser of a corporation's notes who was required to pay the notes when the corporation became insolvent sustained a loss from the worthlessness of a nonbusiness debt rather than from a transaction entered into for profit where the corporation was solvent at the time the notes were endorsed but was insolvent though still in existence at the time payment was made under the endorsement.
1Opinion of the Court
OPINION.
Murdock, Judge:
The only question here is whether the petitioners are entitled to a deduction under section 23 (e) (2) for a loss of $96,-410 sustained in a transaction entered into for profit. The Commissioner argues that the only deduction to which they are entitled is for a worthless nonbusiness debt under section 23 (k) (4). Both agree that the two sections are mutually exclusive. Spring City Foundry Co. v. Commissioner, 292 U. S. 182. The petitioners agree that if there was a debt it was a nonbusiness debt but they point out that there was no debt owed by the corporation to Leo…
2Cases cited4 opinions
- Spring City Foundry Co. v. CommissionerSupreme Court of the United States · 1934
- Sherman v. CommissionerUnited States Tax Court · 1952
- Fox v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1951
- Fox v. CommissionerUnited States Tax Court · 1950
3Cited by9 opinions
- Lawrence v. CommissionerUnited States Tax Court · 1957
- Stamos v. CommissionerUnited States Tax Court · 1954
- Pollak v. Commissioner of Internal RevenueCourt of Appeals for the Third Circuit · 1954
- Gersten v. CommissionerUnited States Tax Court · 1957
- Gersten v. CommissionerUnited States Tax Court · 1957
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