Wourms v. Commissioner

Board of Tax Appeals

Wourms v. Commissioner

25 B.T.A. 671, 1932 BTA LEXIS 1478

CourtUnited States Board of Tax Appeals

DecidedFebruary 29, 1932

DocketDocket No. 23780.

StatusPublished

Cited by2 cases

This text of 25 B.T.A. 671 (Wourms 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.

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Wourms v. Commissioner, 25 B.T.A. 671, 1932 BTA LEXIS 1478 (bta 1932).

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Opinion

[672]*672OPINION.

Matthews :

The petitioner in this proceeding is claiming the right to deduct as a bad debt an amount of $50,410, being the difference between $56,660, which he claims was the value of the stock of the Callahan Mining Company, to which he was entitled as compensation, and the amount of $6,250 received by him in 1922 in full settlement of his claim for such services. If the petitioner had received the full amount of the stock to which he was entitled as compensation, the fair market value thereof would have constituted income to him when received. There is no evidence as to what was the fair market value thereof. The statement in the stipulation that [673]*673“ the petitioner alleges that in 1916 responsible parties offered him $56,660 in cash ” for the stock is not evidence of its fair market value. The petitioner did. receive $6,250 in cash, which he correctly included in his income.

But even if the petitioner had established the value of the stock, he is not entitled to a bad debt deduction. The petitioner was on the cash receipts and disbursements basis and never received the stock, never reported it in income or accrued it in any way. There is no basis for a bad debt deduction. See Charles A. Collin, 1 B. T. A. 305, and Charles K. Beekman, 17 B. T. A. 643.

Judgment will be entered for the respondent.

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[672]*672OPINION.

Matthews :

The petitioner in this proceeding is claiming the right to deduct as a bad debt an amount of $50,410, being the difference between $56,660, which he claims was the value of the stock of the Callahan Mining Company, to which he was entitled as compensation, and the amount of $6,250 received by him in 1922 in full settlement of his claim for such services. If the petitioner had received the full amount of the stock to which he was entitled as compensation, the fair market value thereof would have constituted income to him when received. There is no evidence as to what was the fair market value thereof. The statement in the stipulation that [673]*673“ the petitioner alleges that in 1916 responsible parties offered him $56,660 in cash ” for the stock is not evidence of its fair market value. The petitioner did. receive $6,250 in cash, which he correctly included in his income.

But even if the petitioner had established the value of the stock, he is not entitled to a bad debt deduction. The petitioner was on the cash receipts and disbursements basis and never received the stock, never reported it in income or accrued it in any way. There is no basis for a bad debt deduction. See Charles A. Collin, 1 B. T. A. 305, and Charles K. Beekman, 17 B. T. A. 643.

Judgment will be entered for the respondent.

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25 B.T.A. 671, 1932 BTA LEXIS 1478, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wourms-v-commissioner-bta-1932.

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