Court Opinion

ID: 9447480
Source: CourtListenerOpinion
Date Created: 2023-08-03 22:36:14.062532+00
Date Added: 2024-06-11T17:31:04.013643
License: Public Domain

WISDOM, Circuit Judge
(dissenting).
I respectfully dissent. The Court’s holding allows a very small tail to wag a big dog. The taxpayer’s sales of used cars were an everyday occurrence and a normal part of the operation of the automobile rental business. His practice was to sell rental cars after they had been used for only a year, a period one-third or one-fourth shorter than their useful life. To this taxpayer the used car sales were considerably more significant, in the important matter of staying in business, than the rental operation. Thus, his return for 1952 showed an operating loss of $30,145.31 and a long term capital gain of $92,907.68 on the sales of rental cars. His return for 1953 showed an operating loss of $40,127.04 and a long term gain of $91,127.04. Taking the business as a whole, I feel that the facts support the Commissioner’s holding. Here, the profits and losses from the sales of the rental cars came from the everyday operation of the business. In the circumstances of this case, therefore, they should be considered as ordinary income or loss. They are not entitled to the preferential treatment provided in Section 117 for “transactions in property which are not the normal source of business income.” Corn Products Refining Co. v. Commissioner, 1955, 350 U.S. 46, 52, 76 S.Ct. 20, 24, 100 L.Ed. 29.