Ennis v. Commissioner
United States Tax Court
A taxpayer reporting income on the cash receipts and disbursements basis sold property in 1945 in consideration of a down payment in cash and the vendee's contractual obligation to pay the balance of the purchase price in deferred payments extending over a period of years. The obligation was not evidenced by a note or some other evidence of indebtedness such as commonly change hands in commerce.
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A taxpayer reporting income on the cash receipts and disbursements basis sold property in 1945 in consideration of a down payment in cash and the vendee's contractual obligation to pay the balance of the purchase price in deferred payments extending over a period of years. The obligation was not evidenced by a note or some other evidence of indebtedness such as commonly change hands in commerce. Held, the contractual obligation was not the equivalent of cash, and the only amount realized by petitioner on the sale in 1945 was the sum of cash received.
1Opinion of the Court
OPINION.
Arundelu, Judge:
Respondent has increased petitioner’s income for the calendar year 1945 by the sum of $10,871.33 on the ground that the petitioner, who reported her income on the cash receipts method, was required under sections 42, 111 fa), and 111 (b) of the Internal Revenue Code,1 to include in her 1945 income the full amount of her one-half interest in the profit realized from the sale of the Deer Head Inn. See also Regulations 111, section 29.41-1.2 Respondent contends that since the sale is a completed transaction in 1945 the entire profit on the sale is taxable in that year.
We…
2Cases cited6 opinions
- Commissioner of Internal Revenue v. Union Pac. R. Co.Court of Appeals for the Second Circuit · 1936
- Johnston v. CommissionerUnited States Tax Court · 1950
- Helvering v. Nibley-Mimnaugh Lumber Co.Court of Appeals for the D.C. Circuit · 1934
- Bernard Realty Co. v. United StatesCourt of Appeals for the Seventh Circuit · 1951
- Qualls v. Union Cent. Life Ins. Co.Supreme Court of Alabama · 1942
1 more not listed; retrieve them via the Exa API.
3Cited by20 opinions
- Richardson v. CommissionerUnited States Tax Court · 1981
- Earl A. Phillips and Dorothy M. Phillips v. William E. Frank, District Director of Internal RevenueCourt of Appeals for the Ninth Circuit · 1961
- John E. Reed v. Commissioner of Internal RevenueCourt of Appeals for the First Circuit · 1983
- Axe v. United StatesDistrict Court, D. Kansas · 1961
- Estate of Brandes v. CommissionerUnited States Tax Court · 1986
15 more not listed; retrieve them via the Exa API.