United States v. Victor H. And Elsie Akin, Fred C. And Alice M. Kluver, E.F. And Gladys Munroe

BRATTON, Chief Judge.

The question presented for determination is whether portions of annual assessments paid by taxpayers who were farmers to two mutual ditch companies which supplied water for the irrigating of the farms of the taxpayers and were used by such companies to retire long term indebtedness and to purchase a right of way were deductible from gross income of the taxpayers as ordinary and necessary expenses incurred in carrying on their farming businesses.

The taxpayers were engaged in the business of farming in Colorado, and they obtained water for the irrigating of their farm lands…