Rich Hill Ins. Agency, Inc. v. Commissioner
United States Tax Court
Petitioner's predecessor in interest acquired an insurance agency "with all of its equipment, furniture, fixtures, insurance policy expirations, accounts receivable and all assets whatsoever" under a written contract which by a separate clause contained a 5-year covenant not to compete. The covenant was not bargained for separately, no part of the consideration was expressly allocated to the covenant, nor was there any discussion of such an allocation.
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Petitioner's predecessor in interest acquired an insurance agency "with all of its equipment, furniture, fixtures, insurance policy expirations, accounts receivable and all assets whatsoever" under a written contract which by a separate clause contained a 5-year covenant not to compete. The covenant was not bargained for separately, no part of the consideration was expressly allocated to the covenant, nor was there any discussion of such an allocation. Vendor then sold his other business interests in the area and entered a new career in government. Three years after acquiring the interest…
1Opinion of the Court
FORRESTER, Judge:
Respondent has determined a deficiency of $1,564.07 in petitioner’s income tax for the taxable year 1967. The only issue presented for our decision is whether petitioner is entitled to a deduction for the depreciation of a covenant not to compete.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found. The stipulation and exhibits attached thereto are incorporated herein by this reference.
At the time of the filing of the petition herein petitioner’s principal office was in Rich Hill, Mo. Petitioner filed its corporation income tax return with the Internal…
2Cases cited14 opinions
- Schulz v. CommissionerCourt of Appeals for the Ninth Circuit · 1961
- Michaels v. CommissionerUnited States Tax Court · 1949
- Annabelle Candy Co. v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1962
- Charles W. Balthrope and Mary v. Balthrope v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1966
- Emmette L. Barran and Martha Barran v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1964
9 more not listed; retrieve them via the Exa API.
3Cited by30 opinions
- Major v. CommissionerUnited States Tax Court · 1981
- Forward Communications Corp. v. United StatesUnited States Court of Claims · 1979
- Peterson Machine Tool, Inc. v. CommissionerUnited States Tax Court · 1982
- Hamilton Industries, Inc. v. CommissionerUnited States Tax Court · 1991
- Kinney v. CommissionerUnited States Tax Court · 1972
25 more not listed; retrieve them via the Exa API.