Stein v. Commissioner
United States Board of Tax Appeals
The availability of the defense of the statute of limitations in and of itself is not a sufficient ascertainment of worthlessness to justify the charging off of a note as a bad debt.
1Opinion of the Court
*1017OPINION.
MoReis:
The question is whether the petitioner may deduct in his income-tax return for 1919, as a bad debt, an amount of $36,302.85. We have held in the Appeal of Steele Cotton Mill Co., 1 B. T. A. 299, that before a taxpayer is entitled to take a deduction for a debt ascertained to be worthless, he must take reasonable steps to determine that there is no probability of payment or collection and have prima facie evidence to prove that the debt has no value. No such evidence was introduced in this appeal. All the testimony shows is that the petitioner made repeated demands between the…
2Cases cited1 opinion
- Hulbert v. . ClarkNew York Court of Appeals · 1891
3Cited by10 opinions
- G. M. Standifer Constr. Corp. v. CommissionerUnited States Board of Tax Appeals · 1934
- Watson v. FahsDistrict Court, S.D. Florida · 1954
- Algy, Inc. v. CommissionerUnited States Tax Court · 1952
- Emmons v. CommissionerUnited States Tax Court · 1943
- Granger v. CommissionerUnited States Tax Court · 1978
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