Dunn & Baker v. Commissioner
United States Board of Tax Appeals
DEPLETION - DISCOVERY VALUE. - A basalt rock quarry is not a "mine" and deductions for depletion thereof may not be based on discovery value. Further, the evidence does not establish fair market value at the basic date, which is a necessary element to the allowance of depletion deductions on the basis of discovery value.
1Opinion of the Court
*665OPINION.
Arundeld:
Petitioner claims deductions for the depletion of its basalt rock deposit on the basis of discovery value. Section 23 (1) of the Kevenue Act of 1928 provides for a reasonable allowance for depletion of “ mines, oil and gas wells, other natural deposits, and timber.” Section 114 prescribes the basis for depletion allowances. The general rule under that section as to property acquired by purchase is that the basis is cost of the property. Two exceptions are made, one of which relates to oil and gas wells and the other, contained in section 114 (b) (2),1 relates to mines and…
2Cases cited4 opinions
- Old Colony Railroad v. CommissionerSupreme Court of the United States · 1932
- Reinecke v. SpaldingSupreme Court of the United States · 1930
- Tex-Penn Oil Co. v. CommissionerUnited States Board of Tax Appeals · 1933
- Parker Gravel Co. v. CommissionerUnited States Board of Tax Appeals · 1930
3Cited by7 opinions
- Albritton v. CommissionerUnited States Tax Court · 1961
- Champlin v. CommissionerUnited States Board of Tax Appeals · 1934
- Duffy v. CommissionerUnited States Tax Court · 1954
- Dunn & Baker v. CommissionerUnited States Board of Tax Appeals · 1934
- Hall v. CommissionerUnited States Tax Court · 1949
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