Laster v. Commissioner
United States Board of Tax Appeals
1. The petitioners entered into contracts for the drilling of wells under the terms of which the contractor agreed to drill the hole and furnish specified material and equipment and petitioners were in no case to furnish more than water, fuel, tanks, and flow lines and swab the well in and supervise the drilling of the sand area and the running of the casing.
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1. The petitioners entered into contracts for the drilling of wells under the terms of which the contractor agreed to drill the hole and furnish specified material and equipment and petitioners were in no case to furnish more than water, fuel, tanks, and flow lines and swab the well in and supervise the drilling of the sand area and the running of the casing. Held, following Retsal Drilling Co.,42 B.T.A. 1057, that no part of the amounts paid to the drilling contractors is deductible as intangible drilling and development costs. 2. The petitioners agreed to pay a lump sum for the…
1Opinion of the Court
*169OPINION.
Issue I.
Disney:
The first issue involves amounts disallowed by the respondent for intangible drilling and development costs deducted by the petitioners on account of the Lambert, Taylor, Brown, Coates, and Bollins wells upon the ground that the wells were drilled under turnkey contracts. The petitioners do not deny that amounts paid by an operator for the drilling of a well under a turnkey contract must be capitalized. The first point argued by the petitioners' upon brief is that they did not in any instance receive a completed and equipped well, and, accordingly, the wells were not…
2Cases cited3 opinions
- Thornhill v. AlabamaSupreme Court of the United States · 1940
- Palmer v. BenderSupreme Court of the United States · 1932
- Thomas v. PerkinsSupreme Court of the United States · 1937
3Cited by17 opinions
- Estate of H. H. Weinert, Deceased, Jane W. Blumberg, and Hilda B. Weinert v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1961
- Huber Homes, Inc. v. CommissionerUnited States Tax Court · 1971
- William H. Zuhone, Jr. And Audra M. Zuhone v. Commissioner of Internal RevenueCourt of Appeals for the Seventh Circuit · 1989
- Mills Estate, Inc. v. Commissioner of Internal Revenue. Commissioner of Internal Revenue v. Mills Estate, IncCourt of Appeals for the Second Circuit · 1953
- Gravois Planing Mill Company, Charles A. And Florence Beckemeier v. Commissioner of Internal RevenueCourt of Appeals for the Eighth Circuit · 1962
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