Waksal v. Director

In this tax appeal, the Court considers the deductibility of a worthless nonbusiness debt under a provision of the New Jersey Gross Income Tax Act, N.J.S.A 54A:1-1 to 10-12 (the Act). This *227case arose from a dispute about such a deduction in the 2004 New Jersey income tax return filed by plaintiffs Harlan W. Waksal and Carol Waksal (the Waksals). In their New Jersey income tax return, as in their federal income tax return for the same year, the Waksals reported a $14,769,320 loss due to a worthless nonbusiness debt arising from Harlan WaksaTs loan in that amount to his brother who failed to…