Bank of Brady v. Commissioner ( 1926 )

APPEAL OF BANK OF BRADY.

Bank of Brady v. Commissioner

Docket No. 1899.

United States Board of Tax Appeals

3 B.T.A. 391; 1926 BTA LEXIS 2681;

January 19, 1926, Decided Submitted July 3, 1925.

---

Arthur J. Seaton, Esq., for the Commissioner.

---

Before JAMES, LITTLETON, SMITH, and TRUSSELL.

This is an appeal from the determination of a deficiency in income and profits taxes for the year 1920 in the amount of $159.09, and of overassessments for the years 1919 and 1921 in the amounts of $18.21 and $45.99, respectively. The deficiency and the overassessments are the result of adjustments of invested capital and depreciation deductions made by the Commissioner in his audit of the taxpayer's returns for the said years. The appeal was submitted upon the pleadings and depositions furnished on behalf of the taxpayer.

FINDINGS OF FACT.

The taxpayer is a Nebraska corporation with its principal place of business at Brady. It was organized in 1904 and immediately began carrying on the business of banking, occupying a small building on lots 1 and 2 of block 11 in the said city.

In 1910 it purchased the above-described property, paying therefor the sum of $3,250. In 1914 it sold the building for $310. The building was thereupon removed, and upon the same land the taxpayer constructed a banking building, at a cost of $3,340.85, which had a reasonable useful life of 50 years. This building was completed in the year 1914 and the taxpayer has since occupied it as its place of business.

During the time from the organization of the taxpayer to the end of the year 1921 the taxpayer purchased from time to time banking-house fixtures, furniture and equipment and used the same in its business, the dates of the acquisition thereof and the cost being as follows:

1904	$502.10
1907	275.75
1908	253.85
1909	304.50
1914	771.25
1915	$48.05
1916	22.56
1919	575.20
1920	2,073.68
1921	152.48

A reasonable allowance for exhaustion, wear and tear of the fixtures, furniture and office equipment is an amount computed for each year on the basis of 6 per cent of the cost of the equipment in use during each year respectively.

DECISION.

The deficiency for 1920, and the overassessments for 1919 and 1921, should all be computed in accordance with the foregoing findings of fact. Final determination will be settled on 15 days' notice, in accordance with Rule 50.