Frieda Bernstein v. Commissioner of Internal Revenue, and Three Other Consolidated Cases

Second Circuit

Frieda Bernstein v. Commissioner of Internal Revenue, and Three Other Consolidated Cases

230 F.2d 603, 49 A.F.T.R. (P-H) 311, 1956 U.S. App. LEXIS 5184

CourtCourt of Appeals for the Second Circuit

DecidedMarch 5, 1956

Docket19-1071

StatusPublished

Cited by21 cases

This text of 230 F.2d 603 (Frieda Bernstein v. Commissioner of Internal Revenue, and Three Other Consolidated Cases) is published on Counsel Stack Legal Research, covering Court of Appeals for the Second Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Frieda Bernstein v. Commissioner of Internal Revenue, and Three Other Consolidated Cases, 230 F.2d 603, 49 A.F.T.R. (P-H) 311, 1956 U.S. App. LEXIS 5184 (2d Cir. 1956).

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Opinion

PER CURIAM.

The taxpayers here seek to avoid the deficiencies assessed against them for 1946 and 1947 income taxes by showing error in the disallowance of depreciation and amortization deductions claimed by them. They bought land in New York City subject to a long-term lease, upon which was a commercial office building erected by the tenant before their purchase. They seek deduction of the claimed value of this building prorated over the remaining term of the lease, and they also seek amortization of what they claim is the “premium” value of this favorable lease. But as the Tax Court found, 22 T.C. 1146, they offered no proof to sustain their claims as being at all realities. See C. I. R. v. Moore, 9 Cir., 207 F.2d 265, certiorari denied *604 347 U.S. 942, 74 S.Ct. 637, 98 L.Ed. 1091. The purchase price they paid was $428,-579.88, and the tax assessment figures upon which they relied indicated a value, of $500,000 for the land and $900,000 for the building. A natural conclusion might well be that the cost of the building was already eliminated from the price. At any rate, there was no showing that the useful life of the building would be longer than the term of the lease, or that there were favorable office rents to show a real premium over rental value, or in short that there was anything in the nature of wasting assets to be written off. The recent case of Millinery Center Bldg. Corp. v. C. I. R., 2 Cir., 221 F.2d 322, certiorari granted 350 U.S. 820, 76 S.Ct. 79, relied on by the taxpayers, involved substantially different facts and a quite different measure of proof.

Affirmed.

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PER CURIAM.

The taxpayers here seek to avoid the deficiencies assessed against them for 1946 and 1947 income taxes by showing error in the disallowance of depreciation and amortization deductions claimed by them. They bought land in New York City subject to a long-term lease, upon which was a commercial office building erected by the tenant before their purchase. They seek deduction of the claimed value of this building prorated over the remaining term of the lease, and they also seek amortization of what they claim is the “premium” value of this favorable lease. But as the Tax Court found, 22 T.C. 1146, they offered no proof to sustain their claims as being at all realities. See C. I. R. v. Moore, 9 Cir., 207 F.2d 265, certiorari denied *604 347 U.S. 942, 74 S.Ct. 637, 98 L.Ed. 1091. The purchase price they paid was $428,-579.88, and the tax assessment figures upon which they relied indicated a value, of $500,000 for the land and $900,000 for the building. A natural conclusion might well be that the cost of the building was already eliminated from the price. At any rate, there was no showing that the useful life of the building would be longer than the term of the lease, or that there were favorable office rents to show a real premium over rental value, or in short that there was anything in the nature of wasting assets to be written off. The recent case of Millinery Center Bldg. Corp. v. C. I. R., 2 Cir., 221 F.2d 322, certiorari granted 350 U.S. 820, 76 S.Ct. 79, relied on by the taxpayers, involved substantially different facts and a quite different measure of proof.

Affirmed.

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230 F.2d 603, 49 A.F.T.R. (P-H) 311, 1956 U.S. App. LEXIS 5184, Counsel Stack Legal Research, https://law.counselstack.com/opinion/frieda-bernstein-v-commissioner-of-internal-revenue-and-three-other-ca2-1956.

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