Feldman v. Commissioner ( 1926 )

APPEAL OF DAVID FELDMAN.

Feldman v. Commissioner

Docket No. 5604.

United States Board of Tax Appeals

3 B.T.A. 434; 1926 BTA LEXIS 2652;

January 26, 1926, Decided Submitted November 17, 1925.

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David T. Wiener, Esq., for the taxpayer.

W. F. Gibbs, Esq., for the Commissioner.

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Before LITTLETON, SMITH and TRUSSELL.

This is an appeal from the determination of a deficiency in income tax for the calendar year 1923 in the amount of $443.96, arising from the following:

(1) Inclusion in gross income of a second-trust note at its face value of $7,500.

(2) Failure to allow a deduction of $500 from the sales price of the property as commission paid thereon.

(3) Increase of the taxpayer's income on account of groceries for personal use from $500 to $1,000.

FINDINGS OF FACT.

Taxpayer is a resident of the District of Columbia, engaged in selling groceries at retail. In 1923 he acquired, through the sale of a brick store and residence building at 500 Twelfth Street N.E., Washington, D.C., a second-trust note of the face value of $7,500 as part of the sales price thereof. In computing the profit upon the sale the Commissioner included the second-trust note at the face value of $7,500. The fair market value of the second-trust note at the time received in 1923 was 70 per cent of its face value, or $5,250. The taxpayer paid a commission of $500 upon the sale of the property.

During 1923 taxpayer provided his family, consisting of himself, his wife, and five children, the elder being 11 years of age, with such vegetables and groceries as were required from the store operated by him, without keeping a separate account thereof. In his return for the taxable year he included the amount of $500 as income on account of groceries for personal use, which amount the Commissioner increased to $1,000. In observance of religious laws, taxpayer ate no meat or bread such as he carried in his store. Income to the taxpayer on account of groceries for personal use from his store amounted to $500 during the taxable year.

DECISION.

The deficiency should be computed in accordance with the foregoing findings of fact. Final determination will be settled on 10 days' notice, under Rule 50.