Sun Co. & Subsidiaries v. Commissioner
United States Tax Court
On petitioners' consolidated Federal income tax return for the taxable year 1971, deductions were claimed for intangible drilling costs incurred in connection with the drilling of offshore wells with mobile rigs.
Read the full summary
On petitioners' consolidated Federal income tax return for the taxable year 1971, deductions were claimed for intangible drilling costs incurred in connection with the drilling of offshore wells with mobile rigs. The deductions were disallowed in the statutory notice of deficiency on the ground that such costs did not come within the definition of "intangible drilling and development costs" found in sec. 1.612-4, Income Tax Regs., and that, therefore, such costs should be treated as capital costs of the properties concerned. Held, the intangible expenses incurred in drilling each of the wells…
1Opinion of the Court
Goffe, Judge:
The Commissioner determined deficiencies in the Federal income taxes due from the petitioners in the following amounts for the designated taxable years:
TYE Dec. 31— Deficiency
1969 . $3,193,299
1970 . ..2,618,218
1971 . ..1,196,609
After settlement of numerous issues determined in the Commissioner’s statutory notice of deficiency, only the taxable year ending December 31, 1971, remains in controversy. The only issue remaining for our decision is whether petitioners may deduct as intangible drilling and development costs their aliquot share of the intangible costs of drilling 17…
2Cases cited12 opinions
- Newark Morning Ledger Company, a Corporation of the State of New Jersey v. The United States of AmericaCourt of Appeals for the Third Circuit · 1976
- Louisiana Land & Exploration Co. v. CommissionerUnited States Tax Court · 1946
- Louisiana Land & Exp. Co. v. Commissioner of Int. Rev.Court of Appeals for the Fifth Circuit · 1947
- Haass v. CommissionerUnited States Tax Court · 1970
- F. H. E. Oil Co. v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1945
7 more not listed; retrieve them via the Exa API.
3Cited by17 opinions
- Seligman v. CommissionerUnited States Tax Court · 1985
- Standard Oil Co. v. CommissionerUnited States Tax Court · 1981
- Keller v. CommissionerUnited States Tax Court · 1982
- Sun Company Inc. And Subsidiaries (Consolidated) v. Commissioner of Internal RevenueCourt of Appeals for the Third Circuit · 1982
- Gulf Oil Corp. v. CommissionerUnited States Tax Court · 1986
12 more not listed; retrieve them via the Exa API.