Geneva Drive-In Theatre, Inc. v. Commissioner
United States Tax Court
In 1950 John Huston leased land to a lessee under a lease which, with renewal options, extended for 20 years. Pursuant to the lease, lessee constructed improvements for the operation of a drive-in theater. In 1965 petitioners purchased the property from Huston subject to the lease, paying $ 200,000 more than the raw land would have been worth. The useful lives of the improvements extended beyond the remainder of the lease term.
Read the full summary
In 1950 John Huston leased land to a lessee under a lease which, with renewal options, extended for 20 years. Pursuant to the lease, lessee constructed improvements for the operation of a drive-in theater. In 1965 petitioners purchased the property from Huston subject to the lease, paying $ 200,000 more than the raw land would have been worth. The useful lives of the improvements extended beyond the remainder of the lease term. Held: Petitioners are not entitled to depreciation deductions in respect of the improvements until after the termination of the lease on Mar. 2, 1970. Thereafter, they…
1Opinion of the Court
Featherston, Judge:
Respondent determined the following deficiencies in petitioners’ Federal income taxes:
Petitioner Tax year ended Deficiency
Geneva Drive-In Theatre, Inc June 30, 1968 $4,190
June 30, 1969 5,465
June 30, 1970 5,458
June 30, 1971 639
Las Vegas Theatrical Corp, Mar. 31, 1971 645
Concord Theatre Co. Mar. 31, 1968 5,244
Mar. 31,1969 3,072
Mar. 31,1970 2,530
Mar. 31,1971 3,712
The only issue for our decision is whether petitioners are entitled under section 167(a)2 to depreciation deductions in respect of certain improvements erected or installed by the lessee of property acquired by…
2Cases cited16 opinions
- Helvering v. F. & R. Lazarus & Co.Supreme Court of the United States · 1939
- Detroit Edison Co. v. CommissionerSupreme Court of the United States · 1943
- Commissioner of Internal Revenue v. Moore. Moore v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1953
- Moore v. CommissionerUnited States Tax Court · 1950
- Millinery Center Building Corp. v. CommissionerSupreme Court of the United States · 1956
11 more not listed; retrieve them via the Exa API.
3Cited by7 opinions
- Coleman v. CommissionerUnited States Tax Court · 1986
- Geneva Drive in Theatre, Inc. Las Vegas Theatrical Corp. Concord Theatre Co. v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1980
- Sanders v. CommissionerUnited States Tax Court · 1980
- Browning-Ferris Industries, Inc. v. CommissionerUnited States Tax Court · 1987
- Coleman v. CommissionerUnited States Tax Court · 1986
2 more not listed; retrieve them via the Exa API.