Phoenix Mut. Life Ins. Co. v. Commissioner
United States Tax Court
P, a life insurance company, received prepayment premiums upon the early retirement of mortgage loans made to corporate borrowers after 1954. The mortgage loans, which were held by P as part of its investment activities, provided for stated interest at regular intervals and were not made at a discount.
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P, a life insurance company, received prepayment premiums upon the early retirement of mortgage loans made to corporate borrowers after 1954. The mortgage loans, which were held by P as part of its investment activities, provided for stated interest at regular intervals and were not made at a discount. Held: The prepayment premiums are to be treated as long-term capital gain and, as such, are excludable from P's gross investment income under sec. 804(b). Prudential Insurance Co. of America v. Commissioner, 90 T.C. 36 (1988), revd. 882 F.2d 832 (3d Cir. 1989), will no longer be followed.
1Opinion of the Court
Phoenix Mutual Life Insurance Co., Petitioner v. Commissioner of Internal Revenue, Respondent
Phoenix Mut. Life Ins. Co. v. Commissioner
Docket No. 31993-87
United States Tax Court
96 T.C. 481; 1991 U.S. Tax Ct. LEXIS 19; 96 T.C. No. 17;
March 12, 1991, Filed
P, a life insurance company, received prepayment premiums upon the early retirement of mortgage loans made to corporate borrowers after 1954. The mortgage loans, which were held by P as part of its investment activities, provided for stated interest at regular intervals and were not made at a discount. Held: The prepayment premiums are to be…
2Cases cited23 opinions
- Jack E. Golsen and Sylvia H. Golsen v. Commissioner of Internal RevenueCourt of Appeals for the Tenth Circuit · 1971
- D. Ginsberg & Sons, Inc. v. PopkinSupreme Court of the United States · 1932
- Commissioner v. Gillette Motor Transport, Inc.Supreme Court of the United States · 1960
- Willcutts v. BunnSupreme Court of the United States · 1931
- Fairbanks v. United StatesSupreme Court of the United States · 1939
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