Rudie v. Commissioner
United States Tax Court
Upon the termination of a lease on the building where he operated a drugstore, petitioner purchased the business of his only competitor in a community of 1,500 persons. The purchase price of $ 23,750 included amounts allocated to the business name, land, building, fixtures, prescription file, and a covenant by the owner not to compete for 5 years.
Read the full summary
Upon the termination of a lease on the building where he operated a drugstore, petitioner purchased the business of his only competitor in a community of 1,500 persons. The purchase price of $ 23,750 included amounts allocated to the business name, land, building, fixtures, prescription file, and a covenant by the owner not to compete for 5 years. After remodeling the building, petitioner moved his business there under his own business name and then operated the only drugstore in the community. Petitioner did not advertise the purchase of the prescription file or directly solicit the business…
1Opinion of the Court
OPINION
On the first issue, respondent contends that the cost of the prescription file cannot be amortized3 because the file is a single indivisible capital asset which is not exhausted by the passage of time or is in the nature of goodwill, or, alternatively, because petitioner has failed to establish a cost of $3,000 or a useful life of 3 years. Petitioner characterizes the file as an intangible asset, useful in his business for only a limited period, and argues that the allocation was at arm’s length and the useful life was estimated with reasonable accuracy.
In support of his position that…
2Cases cited15 opinions
- Welch v. HelveringSupreme Court of the United States · 1933
- Ullman v. CommissionerCourt of Appeals for the Second Circuit · 1959
- Hamlin's Trust v. Commissioner of Internal Revenue. Nowel's Estate v. Commissioner of Internal RevenueCourt of Appeals for the Tenth Circuit · 1954
- Michaels v. CommissionerUnited States Tax Court · 1949
- Tauber v. CommissionerUnited States Tax Court · 1955
10 more not listed; retrieve them via the Exa API.
3Cited by20 opinions
- Lucas v. CommissionerUnited States Tax Court · 1972
- Los Angeles Cent. Animal Hospital, Inc. v. CommissionerUnited States Tax Court · 1977
- Proulx v. United StatesUnited States Court of Claims · 1979
- Winchell Co. v. CommissionerUnited States Tax Court · 1969
- Morris v. CommissionerUnited States Tax Court · 1968
15 more not listed; retrieve them via the Exa API.