Carolina Light & Power Co. v. Commissioner
United States Board of Tax Appeals
The petitioner in 1905 purchased a piece of real estate for $2,500 for the purpose of erecting an ice plant on it, in the event the drilling of a well thereon would supply sufficient water.
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The petitioner in 1905 purchased a piece of real estate for $2,500 for the purpose of erecting an ice plant on it, in the event the drilling of a well thereon would supply sufficient water. A well was drilled thereon, proved a failure, was capped, never used, added no value to the real estate, and the project of erecting the ice plant was in the same year abandoned, the cost of drilling the well being then ascertained to be $5,396.99. In 1916 petitioner made an agreement with one Carroll to sell the property to him for $1,500, of which $150 was to be paid cash, the same amount in one year,…
1Opinion of the Court
*143OPINION.
Seawell:
The petitioner, in 1905, drilled a well on its land at Aiken, S. C., at a cost of $5,396.99. The sole purpose in drilling the well was to obtain water in sufficient quantity to operate an ice plant. The well proved to be a failure, was capped in the same year, and the ice plant project was then abandoned. The petitioner contends that the cost of drilling the well should be added to $2,500, the original cost of the land, in order to ascertain the profit or loss (under section 204 (b) of the Revenue Act of 1926) realized when the land was sold. The drilling of the well should…
2Cases cited3 opinions
- B. P. Jones & Co. v. CashCourt of Appeals of Kentucky · 1920
- Peterson v. RichmanTennessee Supreme Court · 1893
- Faddell v. TaylorTexas Commission of Appeals · 1922
3Cited by1 opinion
- Carolina Light & Power Co. v. CommissionerUnited States Board of Tax Appeals · 1931