Reichel v. Commissioner
United States Tax Court
P, a real estate developer, purchases properties intending to develop them. He undertook no development activities on the properties due to adverse economic conditions. R disallowed P's deductions of the properties' real estate taxes, determining the taxes must be capitalized under sec. 263A, I.R.C., as indirect expenses of producing property. HELD: P must capitalize the tax payments under sec. 263A, I.R.C.
1Opinion of the Court
OPINION
Laro, Judge:
This case was submitted to the Court without trial pursuant to Rule 122(a). John J. Reichel petitioned the Court to redetermine a 1993 income tax deficiency of $32,887 and a $6,577 accuracy-related penalty under section 6662(a). Respondent reflected this determination in a notice of deficiency issued to petitioner on September 5, 1997.
Following concessions by the parties, we must decide whether section 263A requires petitioner to capitalize real estate taxes he paid in 1993 on land he purchased for development. We hold it does. Unless otherwise indicated, section references…
2Cases cited2 opinions
- Weinberger v. Hynson, Westcott & Dunning, Inc.Supreme Court of the United States · 1973
- Von-Lusk v. CommissionerUnited States Tax Court · 1995
3Cited by6 opinions
- Suzy's Zoo (R) v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 2001
- ADVO, Inc. & Subsidiaries v. CommissionerUnited States Tax Court · 2013
- TSAKOPOULOS v. COMMISSIONERUnited States Tax Court · 2002
- Advo, Inc. & Subsidiaries v. CommissionerUnited States Tax Court · 2013
- John J. Reichel v. CommissionerUnited States Tax Court · 1999
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