Schultz v. Commissioner
United States Tax Court
Petitioner purchased raw whisky, distilled as bourbon, as an investment and, at the time of purchase, made payment in advance to the seller of 4 years of carrying charges, consisting of insurance, storage, and an amount equal to estimated State ad valorem taxes. The normal aging period of bourbon whisky is 4 years. Petitioner also expended certain sums in payment for certain legal services. Held, that petitioner's objective was to acquire 4-year bourbon whisky.
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Petitioner purchased raw whisky, distilled as bourbon, as an investment and, at the time of purchase, made payment in advance to the seller of 4 years of carrying charges, consisting of insurance, storage, and an amount equal to estimated State ad valorem taxes. The normal aging period of bourbon whisky is 4 years. Petitioner also expended certain sums in payment for certain legal services. Held, that petitioner's objective was to acquire 4-year bourbon whisky. Held, further, that the expenditures for carrying charges are not deductible expense under sec. 212(2), even on a prorated basis, and…
1Opinion of the Court
TanNenwald, Judge:
Respondent determined deficiencies in the joint Federal income taxes of petitioners in the amounts of $32,905.63 and $30,933.35 for the taxable years 1962 and 1963, respectively. After certain concessions by respondent, the following questions remain for our consideration: (1) Whether petitioners may take deductions in 1962 and 1963 for storage charges, insurance, and taxes in connection with the purchase and holding of bulk bourbon whisky,- and (2) whether petitioners may deduct certain legal fees paid in 1962.
FINDINGS OF FACT
Some of tlie facts bave been stipulated and are…
2Cases cited34 opinions
- Knetsch v. United StatesSupreme Court of the United States · 1960
- Corn Products Refining Co. v. CommissionerSupreme Court of the United States · 1956
- Trust Under the Will of Bingham v. CommissionerSupreme Court of the United States · 1945
- Hanover Bank v. CommissionerSupreme Court of the United States · 1962
- Kapel Goldstein and Tillie Goldstein v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1966
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3Cited by29 opinions
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