Axelrod v. Commissioner
United States Tax Court
Petitioner and Cammer were partners in a cafe. Petitioner notified Cammer that unless Cammer purchased his interest he would bring an action for an accounting and dissolution of the partnership. Cammer borrowed funds from a finance company to purchase petitioner's interest in the partnership. Petitioner agreed to guarantee the loan with the finance company. Cammer defaulted on the loan and petitioner was required to pay the finance company the balance due on the loan.
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Petitioner and Cammer were partners in a cafe. Petitioner notified Cammer that unless Cammer purchased his interest he would bring an action for an accounting and dissolution of the partnership. Cammer borrowed funds from a finance company to purchase petitioner's interest in the partnership. Petitioner agreed to guarantee the loan with the finance company. Cammer defaulted on the loan and petitioner was required to pay the finance company the balance due on the loan. Petitioner deducted the amount paid as a bad debt under section 166(f), I.R.C. 1954. Held, the proceeds of the loan were not…
1Opinion of the Court
OPINION.
Duennen, Judge:
Respondent determined a deficiency in petitioner’s income tax for the taxable year 1957 in the amount of $2,417.33. The only issue for decision is whether petitioner is entitled to a deduction under section 166(f) of the Internal Revenue Code of 1954 as the result of a loss sustained by petitioner as guarantor of a noncorporate obligation.
All of the facts have been stipulated, are so found and are incorporated herein by reference. Those necessary to an understanding of our inquiry are recited below.
Petitioner lived in Ohio in 1957 and filed his income tax return for the…
2Cases cited3 opinions
- Putnam v. CommissionerSupreme Court of the United States · 1956
- DeGanay v. LedererSupreme Court of the United States · 1919
- Risko v. CommissionerUnited States Tax Court · 1956
3Cited by8 opinions
- Coors v. CommissionerUnited States Tax Court · 1973
- Imel v. CommissionerUnited States Tax Court · 1973
- Max Axelrod v. Commissioner of Internal RevenueCourt of Appeals for the Sixth Circuit · 1963
- Axelrod v. CommissionerUnited States Tax Court · 1962
- Coors v. CommissionerUnited States Tax Court · 1973
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