Exposition Souvenir Corp. v. Commissioner

The New York World's Fair of 1939 was financed by the sale of interest bearing debentures which were payable out of gate receipts. Concessions were awarded to those who agreed to take the greatest amount of debentures. Petitioner, a New York corporation, acquired $130,000 worth of debentures as a condition precedent to obtaining its concessions at the Fair. Petitioner operated the concessions through two seasons and when the Fair was finally closed, disposed of the debentures at a loss of $92,399.69. At all times petitioner treated them as investments but in its income tax return for 1941…