Smith v. Commissioner
United States Tax Court
The State Highway Commission condemned 19.91 acres of petitioners' land for public use in the construction of an interstate highway system. Petitioners then sold a 1-acre lot of their remaining land at a gain of $ 48,923.16 and claimed that sec. 1033(a)(3)(A) would apply to reduce that gain by $ 36,000, the cost to petitioners of alleged replacement property in respect to the condemned land.
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The State Highway Commission condemned 19.91 acres of petitioners' land for public use in the construction of an interstate highway system. Petitioners then sold a 1-acre lot of their remaining land at a gain of $ 48,923.16 and claimed that sec. 1033(a)(3)(A) would apply to reduce that gain by $ 36,000, the cost to petitioners of alleged replacement property in respect to the condemned land. Held, petitioners' economic unit, their farming business, was not rendered impractical by the taking, they had sufficient remaining cropland to continue their business, and sec. 1033(a)(3)(A) will not…
1Opinion of the Court
IRWIN, Judge:
Respondent determined a deficiency in petitioners’ income tax for 1968 in the amount of $8,986.88. The deficiency arises from petitioners’ treatment of the gain realized on the sale of a 1-acre lot from a particular tract of their land. Another portion of this same tract had previously been taken for public use in a condemnation proceeding. The sole issue for determination is whether the sale falls within the ambit of section 1033(a) (3) (A) of the Internal Revenue Code of 19541 so that a part of petitioners’ gain on the sale will not be recognized.
findings of fact
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2Cases cited1 opinion
- Masser v. CommissionerUnited States Tax Court · 1958
3Cited by4 opinions
- Forest City Chevrolet v. CommissionerUnited States Tax Court · 1977
- O. J. Smith and Minnie R. Smith v. Commissioner of Internal RevenueCourt of Appeals for the Fourth Circuit · 1972
- Smith v. CommissionerCourt of Appeals for the Fourth Circuit · 1972
- Smith v. CommissionerUnited States Tax Court · 1971