MAY V. COMMISSIONER 723 F.2d 1434 (9th Cir. 1984) CASE BRIEF

MAY V. COMMISSIONER

723 F.2d 1434 (9th Cir. 1984)

NATURE OF THE CASE: Commissioner (D) appealed an order which held that May's (P) rental payments to an irrevocable trust were ordinary and necessary business expenses under I.R.C. 162(a).

FACTS: P deeded their entire title and interest in improved real property to an irrevocable trust for the benefit of their four children. P and a friend, Harlos Gross, were co-trustees. Although executed and delivered in 1971, the deed was not recorded until 1973. P then rented the property from the trust under an oral lease. P paid $1,000 per month and used it to conduct his medical practice. Gross regularly checked to see if the rent, which D concedes was reasonable, had been paid. D disallowed the deduction for rent. P petitioned and the Tax Court agreed with P. It held that P's rental payments in 1973 were ordinary and necessary business expenses under Internal Revenue Code (IRC) 162(a). D appealed.

ISSUE:

RULE OF LAW:

HOLDING AND DECISION:

LEGAL ANALYSIS:

Get free access to the entire content for Mac, PC or Online

for 2-3 days and free samples of all kinds of products.

https://bsmsphd.com

© 2007-2016 Abn Study Partner