Williams v. Commissioner
United States Tax Court
1. Interest paid by an individual taxpayer on a mortgage indebtedness upon which she was a joint obligor with the other shareholder and the mortgagor corporation and was a signer of an agreement after foreclosure providing that she would make up any deficit in the income from the mortgaged property, held deductible by the taxpayer as interest on indebtedness. 2. Annual fees paid to investment counsel for services of advice as to a taxpayer's investments held deductible under…
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1. Interest paid by an individual taxpayer on a mortgage indebtedness upon which she was a joint obligor with the other shareholder and the mortgagor corporation and was a signer of an agreement after foreclosure providing that she would make up any deficit in the income from the mortgaged property, held deductible by the taxpayer as interest on indebtedness. 2. Annual fees paid to investment counsel for services of advice as to a taxpayer's investments held deductible under Revenue Act of 1942, section 121, amending section 23 (a), Internal Revenue Code.
1Opinion of the Court
OPINION.
Sternhagfn, Judge:
1. The Commissioner explained the disallowance of the deduction of the amounts paid in 1939 and 1940 by this taxpayer to the Mortgage Co. by the statement that:
they do not represent interest, bnt payments under an agreement dated December 27. 1937, which provides that you and W. G. Mennen shall make up any deficit resulting from the operation of certain mortgaged property held by Mennen Estates, Inc., for a period of five years, and are therefore a charge against the corporation.
A payment by a taxpayer of interest on another’s obligation is not deductible by the…
2Cases cited3 opinions
- Mallinckrodt v. CommissionerUnited States Tax Court · 1943
- Brown v. CommissionerUnited States Tax Court · 1942
- Higgins v. CommissionerUnited States Tax Court · 1943
3Cited by18 opinions
- Smith v. CommissionerUnited States Tax Court · 1985
- Arrigoni v. CommissionerUnited States Tax Court · 1980
- Bagley v. CommissionerUnited States Tax Court · 1947
- Clinton L. Whittemore, Jr., and Anne W. Whittemore v. United StatesCourt of Appeals for the Eighth Circuit · 1967
- In Re BarryUnited States Bankruptcy Court, M.D. Tennessee · 1985
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