Sidwell v. Commissioner
United States Tax Court
Petitioner is engaged in the business of digging plastic loam, excavating and processing molding sand, and marketing both products. In 1940 he purchased 3 tracts of land aggregating approximately 15 acres in order to continue his operations. He claimed depletion on 2 tracts, based on discovery value.
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Petitioner is engaged in the business of digging plastic loam, excavating and processing molding sand, and marketing both products. In 1940 he purchased 3 tracts of land aggregating approximately 15 acres in order to continue his operations. He claimed depletion on 2 tracts, based on discovery value. Held, petitioner failed to sustain his burden of proof of showing that the tracts were not proved before purchase; held, further, that he failed to show a proper and adequate basis for computing the probable content of molding sand in such tracts.
1Opinion of the Court
OPINION.
Van Fossan, Judge:
The primary issue in the case at bar is whether or not the petitioner is entitled to discovery value depletion as provided in section 23 (m) and 114 (b) (2) of the Internal Revenue Code.1
The latter section establishes the basis for depletion as the fair market value of the property at the date of discovery, or within 30 days thereafter, if such mines were not acquired as a result of the purchase of a proved tract or lease. Thus, assuming, without deciding, that petitioner’s operation is a “mine” (but see Evangeline Gravel Co., 13 B. T. A. 101; Parker Gravel Co., 21…
2Cases cited1 opinion
- Reinecke v. SpaldingSupreme Court of the United States · 1930
3Cited by5 opinions
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- H. M. Holloway, Inc. v. CommissionerUnited States Tax Court · 1953
- Sidwell v. CommissionerUnited States Tax Court · 1948
- Troup v. CommissionerUnited States Tax Court · 1953