Miles Production Company and Ellison Miles v. Commissioner of Internal Revenue

SIMPSON, Circuit Judge:

The taxpayers appeal from a decision of the United States Tax Court holding that certain losses were suffered in 1961 on nonbusiness debts, as defined by Title 26 U.S.C., Section 166(d), rather than on business debts under Title 26 U.S.C., Section 166(a), 28 T.C.M. 1387, T.C. Memo 1969-274 (1969). Applying the standard promulgated by the Supreme Court in United States v. Generes, 1972, 405 U.S. 93, 92 S.Ct. 827, 31 L.Ed.2d 62, 1 we affirm.

For the most part the operative facts are undisputed. Since 1946, Ellison Miles has been actively engaged in the oil and gas…