Sooy v. Commissioner
United States Board of Tax Appeals
1. Money advanced by one brother to another with the understanding and expectation of both that repayment would be made held to be a loan and not a gift. 2. Where the borrower was in ill health at the time the loan was made and died without repaying it, leaving no estate from which collection could be made, held, the amount of such loan is properly deductible as a bad debt for the year in which it was ascertained to be worthless and written off.
1Opinion of the Court
*494OPINION.
Maequette :
The only question raised by this proceeding is whether monies paid by the petitioner as loans to his brother while the latter was in ill health, although expected to recover, but who died without repaying the loans, can be deducted from income as a bad debt.
The Revenue Act of 1918 provides:
Sec. 214. (a) That in computing net income there shall be allowed as deductions :
****** *(7) Debts ascertained to be worthless and, charged off within the taxable year.
The evidence before us shows that the petitioner advanced to his brother sums of money aggregating $5,000 or more after…
2Cited by5 opinions
- WF Young, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the First Circuit · 1941
- Estate of J. F. Ames v. CommissionerUnited States Tax Court · 1946
- Bowser v. CommissionerUnited States Tax Court · 1948
- Sooy v. CommissionerUnited States Board of Tax Appeals · 1928
- Walker v. CommissionerUnited States Tax Court · 1992