Stough v. Comm'r
United States Tax Court
Lessor (Ps) constructed a commercial building and entered into a 10-year lease with Lessee (L). The lease requires L to pay monthly rent to Ps, and the monthly rent is based on the amount of "project costs" Ps incurred in acquiring and developing the leased property.
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Lessor (Ps) constructed a commercial building and entered into a 10-year lease with Lessee (L). The lease requires L to pay monthly rent to Ps, and the monthly rent is based on the amount of "project costs" Ps incurred in acquiring and developing the leased property. The lease provides L with the unilateral option to make a one-time payment to Ps to reduce "project costs" to be used in the calculation of rent and thus reduce the amount of rent otherwise owed by L under the lease. In 2008 L elected to make a $1 million payment to Ps pursuant to the terms of the lease. R argues that the $1…
1Opinion of the Court
Ruwe, Judge:
Respondent determined a $300,332 deficiency in petitioners’ 2008 Federal income tax and a $58,117.20 accuracy-related penalty under section 6662(a).1 On one of their 2008 Schedules E, Supplemental Income and Loss, petitioners reported as rents received a $1 million payment from Talecris Plasma Resources, Inc. (Talecris). Petitioners then claimed an offsetting $1 million Schedule E “contribution to construct” deduction (Schedule E deduction). Upon examination respondent disallowed the $1 million Schedule E deduction but increased petitioners’ basis in the subject rental property…
2Cases cited11 opinions
- Welch v. HelveringSupreme Court of the United States · 1933
- HIGBEE v. COMMISSIONER OF INTERNAL REVENUEUnited States Tax Court · 2001
- United States v. BoyleSupreme Court of the United States · 1985
- Neonatology Assocs., P.A. v. Comm'rUnited States Tax Court · 2000
- Knudsen v. Comm'rUnited States Tax Court · 2008
6 more not listed; retrieve them via the Exa API.
3Cited by6 opinions
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- Gregory Raifman & Susan Raifman v. CommissionerUnited States Tax Court · 2018
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