Derby Heights, Inc. v. Commissioner
United States Tax Court
The petitioner, which was engaged in the business of owning and developing residential subdivisions, constructed waterlines as a necessary incident to the successful development of the property and in order to further the sales of lots. Subsequently, a water and sewer district took the lines from the petitioner in the exercise of its power of eminent domain. The petitioner brought suit against the district and received an award for such taking.
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The petitioner, which was engaged in the business of owning and developing residential subdivisions, constructed waterlines as a necessary incident to the successful development of the property and in order to further the sales of lots. Subsequently, a water and sewer district took the lines from the petitioner in the exercise of its power of eminent domain. The petitioner brought suit against the district and received an award for such taking. Held, that the waterlines did not constitute property used in the trade or business of the petitioner within the meaning of sec. 1231 of the Internal…
1Opinion of the Court
OPINION
Ateins, Judge:
The respondent determined a deficiency in income tax for the taxable year ended March 31, 1962, in the amount of $832.71. The issue is whether the gain derived from compensation awarded to the petitioner as a result of the condemnation of waterlines constructed by it in connection with the development of its real estate subdivision is taxable as ordinary income or as capital gain.
All of the facts have been stipulated and the stipulations are incorporated herein by this reference.
The petitioner is a corporation organized and existing under the laws of the State of South…
2Cases cited7 opinions
- Colony, Inc. v. CommissionerUnited States Tax Court · 1956
- The Colony, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the Sixth Circuit · 1957
- Herzog Bldg. Corp. v. CommissionerUnited States Tax Court · 1965
- Willow Terrace Dev. Co. v. CommissionerUnited States Tax Court · 1963
- Derby Heights, Inc. v. Gantt Water & Sewer DistrictSupreme Court of South Carolina · 1960
2 more not listed; retrieve them via the Exa API.
3Cited by11 opinions
- Norwest Corp. v. Comm'rUnited States Tax Court · 1998
- Noell v. CommissionerUnited States Tax Court · 1976
- Kenneth A. Murry and Helen J. Murry v. Commissioner of Internal Revenue, Lakeside Garden Developers, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1979
- Friedman v. Comm'rUnited States Tax Court · 1977
- Lakeside Garden Developers, Inc. v. CommissionerUnited States Tax Court · 1976
6 more not listed; retrieve them via the Exa API.