Cooley v. Commissioner

U.S. Tax Court

Cooley v. Commissioner

33 T.C. 223, 1959 U.S. Tax Ct. LEXIS 46

CourtUnited States Tax Court

DecidedNovember 6, 1959

DocketDocket No. 68893

StatusPublished

Cited by5 cases

This text of 33 T.C. 223 (Cooley v. Commissioner) is published on Counsel Stack Legal Research, covering United States Tax Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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Cooley v. Commissioner, 33 T.C. 223, 1959 U.S. Tax Ct. LEXIS 46 (tax 1959).

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Opinion

OPINION.

Raum, Judge:

It is generally true, as petitioner contends, that a taxpayer is entitled to deduct the fair market value of property (other than money) contributed to a charity. Begs. 118, sec. 39.23 (o)-1(g). But “fair market value” is not to be determined in a vacuum. To the contrary, it must be determined with respect to the particular property in question at the time of contribution, subject to any conditions or restrictions on marketability. In the present case it is clear that petitioner did not at any time have a right to resell the automobiles in question. He never intended to resell them and could not have done so without violating a specific condition of his arrangement with General Motors. Plainly, these automobiles were not marketable in petitioner’s hands, and it would be completely unrealistic to permit him a deduction based on the 1952 retail value of marketable models. The situation is analogous to that presented in a wide variety of cases holding, in other contexts, that property otherwise intrinsically more valuable which is encumbered by some restriction or condition limiting its marketability must be valued in the light of such limitation. Cf., e.g., Helvering v. Salvage, 297 U.S. 106; Helen S. Delone, 6 T.C. 1188. Petitioner has not shown that he is entitled to deduct more than the $17,581.72, which the respondent allowed. Cf. August Heckscher, 36 B.T.A. 1181.

Decision will be entered for ■the respondent.

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OPINION.

Raum, Judge:

It is generally true, as petitioner contends, that a taxpayer is entitled to deduct the fair market value of property (other than money) contributed to a charity. Begs. 118, sec. 39.23 (o)-1(g). But “fair market value” is not to be determined in a vacuum. To the contrary, it must be determined with respect to the particular property in question at the time of contribution, subject to any conditions or restrictions on marketability. In the present case it is clear that petitioner did not at any time have a right to resell the automobiles in question. He never intended to resell them and could not have done so without violating a specific condition of his arrangement with General Motors. Plainly, these automobiles were not marketable in petitioner’s hands, and it would be completely unrealistic to permit him a deduction based on the 1952 retail value of marketable models. The situation is analogous to that presented in a wide variety of cases holding, in other contexts, that property otherwise intrinsically more valuable which is encumbered by some restriction or condition limiting its marketability must be valued in the light of such limitation. Cf., e.g., Helvering v. Salvage, 297 U.S. 106; Helen S. Delone, 6 T.C. 1188. Petitioner has not shown that he is entitled to deduct more than the $17,581.72, which the respondent allowed. Cf. August Heckscher, 36 B.T.A. 1181.

Decision will be entered for ■the respondent.

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33 T.C. 223, 1959 U.S. Tax Ct. LEXIS 46, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cooley-v-commissioner-tax-1959.

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