Auditorium Co. v. Commissioner

Board of Tax Appeals

Auditorium Co. v. Commissioner

5 B.T.A. 163, 1926 BTA LEXIS 2944

United States Board of Tax Appeals·Decided October 21, 1926·No. Docket No. 4483.·Published

Opinion

[164] OPINION.

Lansdon :

The petitioner contends that it is entitled to an annual deduction from gross income on account of depreciation and economic obsolescence of its property at the rate of 4 per cent on the original cost. From the evidence adduced we conclude that the profitable use and economic life of the petitioner’s building can not be more than [165]*16525 years from tlie date of its construction. Measured by the value of the land and the depreciated cost of the building during the taxable years, the annual net income returns a constantly decreasing percentage of profit on the capital value of the property, and we are of the opinion that this petitioner is entitled to deduct annually 4 per cent of the cost of the building from its gross income during each of the taxable years and to any adjustments of invested capital that may result from such deduction for depreciation, including obsolescence. Appeal of Robert H. McCormick, 2 B. T. A. 430; Appeal of Annie L. Dean, 3 B. T. A. 896.

Judgment will be entered on 20 days' notice, under Rule 50.

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[164] OPINION.

Lansdon :

The petitioner contends that it is entitled to an annual deduction from gross income on account of depreciation and economic obsolescence of its property at the rate of 4 per cent on the original cost. From the evidence adduced we conclude that the profitable use and economic life of the petitioner’s building can not be more than [165]*16525 years from tlie date of its construction. Measured by the value of the land and the depreciated cost of the building during the taxable years, the annual net income returns a constantly decreasing percentage of profit on the capital value of the property, and we are of the opinion that this petitioner is entitled to deduct annually 4 per cent of the cost of the building from its gross income during each of the taxable years and to any adjustments of invested capital that may result from such deduction for depreciation, including obsolescence. Appeal of Robert H. McCormick, 2 B. T. A. 430; Appeal of Annie L. Dean, 3 B. T. A. 896.

Judgment will be entered on 20 days' notice, under Rule 50.

Auditorium Co. v. Commissioner, 5 B.T.A. 163, 1926 BTA LEXIS 2944 (bta 1926).

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