Skilling v. Commissioner

41 B.T.A. 888, 1940 BTA LEXIS 1129

Opinion

OPINION.

Tyson :

The- issue here — whether income is realized by the lessor from the repossession, on default of the lessee, of a building erected by the lessee ■ without cost to the lessor — is the.same as- that decided by the Supreme Court in Helvering v. Bruun, 309 U. S. 461, and our decision is controlled by the ruling , in that case. There, a building was erected by the lessee on the leased premises and the value of the building at the time of its repossession by the lessor was held to be income to the lessor in the year of the repossession. We perceive no difference important here between the facts in the Bruun case, supra, and the instant case.

Accordingly, we hold that income of $60,000 was realized by petitioners during the taxable year 1936 from the repossession of the leased premises and the building erected thereon by the lessee.

Decision will he entered under Rule 50.