Case Name: Washington State Bank, Petitioner, v. Commissioner of Internal Revenue, Respondent
Court: United States Board of Tax Appeals
Jurisdiction: United States
Decision Date: 1930-06-12
Citations: 20 B.T.A. 33
Docket Number: Docket No. 19911
Parties: Washington State Bank, Petitioner, v. Commissioner of Internal Revenue, Respondent.
Judges: 
Reporter: Reports of the United States Board of Tax Appeals
Volume: 20
Pages: 33–35

Head Matter:
Washington State Bank, Petitioner, v. Commissioner of Internal Revenue, Respondent.
Docket No. 19911.
Promulgated June 12, 1930.
S. F. Racine, Esq., and T. F. Trumbull, Esq., for the petitioner.
A. H. Fast, Esq., for the respondent.

Opinion:
OPINION.
Matthews:
The petitioner contends that in order to prevent ill effects to itself which might result from the failure of another state bank in the same town, it paid, in purchasing the assets of that bank and assuming its liabilities, $40,000 more than the assets received were worth; and upon this theory seeks to deduct this amount as an expense incident to the transaction, apportioning it over a two-year period.
Our interpretation of the transaction is that the petitioner purchased the going business of the Bank of Clallam County for $821,372.41 and assumed liabilities of the bank in that amount. The fact that the petitioner paid more for the assets than they were worth is not the basis for a deduction.
Judgment will be entered for the respondent.