Brown v. Commissioner

OPINION.

Murdock, Judge:

Section 23 of the Internal Revenue Code allows a deduction for depletion in the case of mines but refers to section 114 (b) (3) and (4) for percentage depletion allowable under it. Section 114 (b) (4) (A) allows, in the case of coal mines, 5 per cent “of the gross income from the property during the taxable year, excluding from such gross income an amount equal to any rents or royalties paid or incurred by the taxpayer in respect of the property” as the deduction for depletion under section 23 (m). Section 114 (b) (4) (B) defines “gross income from the property.” The…