Bolaris v. Commissioner
United States Tax Court
Petitioners listed their old residence with a real estate broker in July 1977 and began construction of a new residence. When the old residence was not sold within 90 days, they rented it on a month-to-month basis and continued their efforts to sell.
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Petitioners listed their old residence with a real estate broker in July 1977 and began construction of a new residence. When the old residence was not sold within 90 days, they rented it on a month-to-month basis and continued their efforts to sell. The property was rented from October 1977 until May 1978 and was ultimately sold in August 1978. Respondent disallowed claimed deductions for depreciation and expenses in excess of rental income, concluding that, since the old residence had not been converted to property held for the production of income, sec. 183, I.R.C. 1954, limited the amount…
1DissentWilbur, J.
The only issue really before the Court is whether or not petitioner is entitled to deduct expenses incurred for the production of income under section 212. In relevant part, section 212 allows the deduction of "all the ordinary and necessary expenses paid or incurred during the taxable year for the management, conservation, or maintenance of property held for the production of income.” That a business venture is temporary or of an indefinite duration has never been grounds for denying the deduction of expenses incurred, any more than it is grounds for excluding the income generated.
It is not…
2Cases cited5 opinions
- Jasionowski v. CommissionerUnited States Tax Court · 1976
- Robinson v. CommissionerUnited States Tax Court · 1943
- Horrmann v. CommissionerUnited States Tax Court · 1951
- John M. Briley and Dorothy D. Briley v. United StatesCourt of Appeals for the Sixth Circuit · 1962
- Johnson v. CommissionerUnited States Tax Court · 1952