Whittemore v. Commissioner , 6 B.T.A. 339 ( 1927 )

GERTRUDE B. WHITTEMORE, PETITIONER, v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT.

Whittemore v. Commissioner

Docket No. 8518.

United States Board of Tax Appeals

6 B.T.A. 339; 1927 BTA LEXIS 3532;

February 28, 1927, Promulgated

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Nelson S. Spencer, Esq., for the petitioner.

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

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MORRIS

This proceeding is for the redetermination of a deficiency of $3,553.11 in income tax for the calendar year 1919 arising, to the extent of the amount in controversy, from the addition by the Commissioner to the selling price of certain real estate of the sum of $9,666.67 for depreciation which had not been taken by the petitioner in any income-tax return during her ownership of the property.

FINDINGS OF FACT.

The petitioner is a resident of Naugatuck, Conn. In 1919 she sold a parcel of real estate for $175,000, on which sale she paid a commission of $3,500. The gross proceeds of the sale to the petitioner were $171,500. The property was acquired by devise in 1911. Its estimated value on March 1, 1913, which was accepted by the Commissioner, was $170,000. To the profit of $1,500, based upon that value, the petitioner in her return added an itme of depreciation of $2,000 claimed and allowed in her return for 1918. The Commissioner added to the $3,500 further items of depreciation computed by him for earlier years, not taken by the petitioner in any income-tax return, amounting to $9,666.67, thus determining a profit of $13,166.67. In each year since 1913 the petitioner has paid a tax on her income, not deducting therefrom, except in 1918, any amount for depreciation of said real estate.

OPINION.

MORRIS: The question raised by the petitioner has previously been considered by us and decided adversely to petitioner's contention. . After the decision of the Court of Claims in , which is cited in the petitioner's brief, we again carefully considered the question, and reached the conclusion, although reluctantly disagreeing with the opinion of the above court, for which we have the greatest respect, that, in determining gain or loss upon the sale of depreciable property, due allowance must be made for depreciation whether or not deductions therefor had been taken by the taxpayer in prior years. ; , and .

Judgment will be entered for the respondent.