Allen v. Commissioner
United States Tax Court
P claimed a $ 25,000 charitable "contribution" to N, an organization exempt from tax under sec. 501(c)(3), I.R.C. 1954. Ten percent of the contribution originated with P, and 90 percent was borrowed from F, a for-profit entity related to N. The principal of the unsecured loan was due in 20 years. Simple annual interest, at 3 percent, was due quarterly. Three-percent interest was a below-market rate.
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P claimed a $ 25,000 charitable "contribution" to N, an organization exempt from tax under sec. 501(c)(3), I.R.C. 1954. Ten percent of the contribution originated with P, and 90 percent was borrowed from F, a for-profit entity related to N. The principal of the unsecured loan was due in 20 years. Simple annual interest, at 3 percent, was due quarterly. Three-percent interest was a below-market rate. Unbeknownst to P, the money he "borrowed" was flowing through a "money circle." Funds originating with N had been loaned to I (a related nonprofit entity), which loaned them to F, which in turn…
1Opinion of the Court
GERBER, Judge:
Respondent, in a statutory notice of deficiency dated June 11, 1984, determined a deficiency in petitioners’ 1981 income tax of $4,541 and an addition under section 6653(a)(1)1 for negligence of $227 plus 50 percent of the interest on the underpayment pursuant to section 6653(a)(2). The issues for consideration are generated by petitioners’ contribution to the National Institute for Business Achievement. We must determine: (1) Whether any part of the claimed contribution is deductible under section 170; and (2) whether petitioners are liable for the additions to tax under…
2Cases cited13 opinions
- Welch v. HelveringSupreme Court of the United States · 1933
- New Colonial Ice Co. v. HelveringSupreme Court of the United States · 1934
- Gregory v. HelveringSupreme Court of the United States · 1935
- Deputy, Administratrix v. Du PontSupreme Court of the United States · 1940
- Neely v. CommissionerUnited States Tax Court · 1985
8 more not listed; retrieve them via the Exa API.
3Cited by108 opinions
- Kenneth Allen Barbara Allen v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1991
- Schwalbach v. CommissionerUnited States Tax Court · 1998
- BUNNEY v. COMMISSIONER OF INTERNAL REVENUEUnited States Tax Court · 2000
- Olive v. CommissionerUnited States Tax Court · 2012
- Sklar, Greenstein & Scheer, P.C. v. CommissionerUnited States Tax Court · 1999
103 more not listed; retrieve them via the Exa API.