Gadlow v. Commissioner
United States Tax Court
In respect of an award of damages for breach of contract, held, G, a cash basis taxpayer, the recipient of the award, must include in his gross income for 1963, the year of receipt, the full amount of the award undiminished by the pertinent legal expenses; held, further, sec. 1305, I.R.C. 1954, must be applied to the full amount of the award, but the pertinent legal expenses, deductible in the year paid, may not be prorated over the earlier years; held, further, G must take…
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In respect of an award of damages for breach of contract, held, G, a cash basis taxpayer, the recipient of the award, must include in his gross income for 1963, the year of receipt, the full amount of the award undiminished by the pertinent legal expenses; held, further, sec. 1305, I.R.C. 1954, must be applied to the full amount of the award, but the pertinent legal expenses, deductible in the year paid, may not be prorated over the earlier years; held, further, G must take into consideration the total amount of the award in computing whether he incurred a net operating loss under sec. 172,…
1Opinion of the Court
OPINION
Tietjens, Judge:
The Commissioner determined a deficiency in income tax of David B. Gadlow (hereinafter sometimes referred to as Gadlow) for the taxable year 1963 in the amount of $12,069.44. The only issue for our determination is how section 1305,1 I.R.C. 1954,2 applies to Gadlow’s damage award in computing the limitation of income tax under this section.
All of the facts are stipulated and are so found. The stipulations and exhibits attached thereto are incorporated herein by this reference.
Petitioners are the Bank of America National Trust & Savings Association and Margaret B.…
2Cases cited14 opinions
- Ethel West Cotnam v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1959
- Commissioner of Internal Revenue v. SmithCourt of Appeals for the Second Circuit · 1953
- Smith v. CommissionerUnited States Tax Court · 1951
- Cotnam v. CommissionerUnited States Tax Court · 1957
- Moore v. CommissionerCourt of Appeals for the Seventh Circuit · 1941
9 more not listed; retrieve them via the Exa API.
3Cited by7 opinions
- Kenseth v. CommissionerUnited States Tax Court · 2000
- Coady v. CommissionerUnited States Tax Court · 1998
- Eldon R. Kenseth and Susan M. Kenseth v. CommissionerUnited States Tax Court · 2000
- Gadlow v. CommissionerUnited States Tax Court · 1968
- Hukkanen-Campbell v. CommissionerUnited States Tax Court · 2000
2 more not listed; retrieve them via the Exa API.