Nichols Contracting Co. v. Commissioner

Board of Tax Appeals

Nichols Contracting Co. v. Commissioner

15 B.T.A. 102, 1929 BTA LEXIS 2922

CourtUnited States Board of Tax Appeals

DecidedJanuary 28, 1929

DocketDocket No. 13399.

StatusPublished

Cited by1 cases

This text of 15 B.T.A. 102 (Nichols Contracting Co. v. Commissioner) is published on Counsel Stack Legal Research, covering United States Board of Tax Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Nichols Contracting Co. v. Commissioner, 15 B.T.A. 102, 1929 BTA LEXIS 2922 (bta 1929).

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Opinion

[105]*105OPINION.

Teussell :

On certain construction equipment of the petitioner the respondent has allowed a deduction of an amount of $16,136.75 from income by way of allowance for exhaustion, wear and tear. The petitioner contends that the allowance for this equipment should amount to $21,270.86. The cost of the assets is not in dispute. The question for decision is purely one of fact. The facts adduced are set out in the findings in full. They need not be repeated here. It is in evidence and uncontroverted that the equipment under consideration was subjected to severe operating conditions which will necessitate extraordinary repairs and renewals, for which it is entirely customary in this business, and reasonable, to make adequate provision. It may be that the relatively large amount of a reserve for depreciation, entered upon the books, has significance in this connection, but, under the peculiar facts in this case and in the entire absence of evidence relative to the reserve, we can not assume such to be a fact. We are satisfied that the amount of $21,270.86 claimed [106]*106by petitioner is a reasonable allowance for the exhaustion, wear and tear of this equipment and we are of the opinion that it should be allowed as a deduction in addition to the deductions allowed by the respondent for wear and tear of other equipment not here at issue.

Judgment will he entered under Rule SO.

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[105]*105OPINION.

Teussell :

On certain construction equipment of the petitioner the respondent has allowed a deduction of an amount of $16,136.75 from income by way of allowance for exhaustion, wear and tear. The petitioner contends that the allowance for this equipment should amount to $21,270.86. The cost of the assets is not in dispute. The question for decision is purely one of fact. The facts adduced are set out in the findings in full. They need not be repeated here. It is in evidence and uncontroverted that the equipment under consideration was subjected to severe operating conditions which will necessitate extraordinary repairs and renewals, for which it is entirely customary in this business, and reasonable, to make adequate provision. It may be that the relatively large amount of a reserve for depreciation, entered upon the books, has significance in this connection, but, under the peculiar facts in this case and in the entire absence of evidence relative to the reserve, we can not assume such to be a fact. We are satisfied that the amount of $21,270.86 claimed [106]*106by petitioner is a reasonable allowance for the exhaustion, wear and tear of this equipment and we are of the opinion that it should be allowed as a deduction in addition to the deductions allowed by the respondent for wear and tear of other equipment not here at issue.

Judgment will he entered under Rule SO.

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15 B.T.A. 102, 1929 BTA LEXIS 2922, Counsel Stack Legal Research, https://law.counselstack.com/opinion/nichols-contracting-co-v-commissioner-bta-1929.

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