Unvert v. Commissioner
United States Tax Court
In his income tax return for 1969, petitioner deducted $ 54,500 as interest paid on indebtedness incurred to purchase real property. In 1972, the interest payment was refunded.
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In his income tax return for 1969, petitioner deducted $ 54,500 as interest paid on indebtedness incurred to purchase real property. In 1972, the interest payment was refunded. After the statute of limitations on assessments for 1969 had run, respondent determined that the refund was taxable to petitioner in 1972. Held, in the light of all the facts, petitioner had a duty to treat the transaction consistently in both 1969 and 1972, and the interest refund is taxable in the latter year under the tax benefit rule.
1Opinion of the Court
Featherston, Judge:
Respondent determined a deficiency of $44,405 in petitioners’ Federal income tax for 1972. The issue for decision is whether $54,500 received in 1972 as a refund of prepaid interest which was claimed and allowed as a deduction in petitioners’ 1969 income tax return is taxable in the later year.
FINDINGS OF FACT
Petitioners Allen D. Unvert and Catherine R. Unvert, husband and wife,1 were legal residents of Newport Beach, Calif., at the time their petition was filed. They filed their joint Federal income tax return for 1972 with the District Director of Internal Revenue for the…
2Cases cited42 opinions
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