Court Opinion

ID: 4592066
Source: CourtListenerOpinion
Date Created: 2020-11-20 19:07:08.506141+00
Date Added: 2024-06-11T07:50:47.894853
License: Public Domain

APPEAL OF EMMONS COAL MINING CO.Emmons Coal Mining Co. v. CommissionerDocket No. 4137.United States Board of Tax Appeals3 B.T.A. 1302; 1926 BTA LEXIS 2431; April 19, 1926, Decided Submitted November 16, 1925.  *2431 H. E. Toulkrod for the taxpayer.  W. F. Gibbs, Esq., for the Commissioner.  LOVE *1302  Before MARQUETTE, MORRIS, GREEN, and LOVE.  This is an appeal from the determination of a deficiency in income tax for the calendar year 1920, in the amount of $3,649.57.  The taxpayer alleges error on the part of the Commissioner in disallowing certain expenditures as ordinary and necessary business expenses.  FINDINGS OF FACT.  The taxpayer is a Pennsylvania corporation and engaged in the business of operating coal mines.  Affiliated with the taxpayer for *1303  the purpose of a consolidated tax return were the Emmons Coal Mining Co. of West Virginia, the Marion Center Coal Mining Co., and the Fallen Timber Coal Co.  During the year 1920, the taxpayer and the affiliated corporations expended the following amounts for storage-battery locomotives, mine cars, and a cutting machine: Emmons Coal Mining Co. of West Virginia, storage battery locomotive$5,412.00Fallen Timber Coal Co., cutting machine3,500.00Marion Center Coal Mining Co.:Storage-battery locomotive4,398.11Storage-battery locomotive4,000.00Mine cars2,125.00*2432  A statement of the tonnage produced for the years 1918, 1919, and 1920, by the said companies, as shown upon their books, is as follows: Mines.1918.1919.1920.Tons.Tons.Tons.Emmons Coal Mining Co. of West Virginia120,907117,737122,267Marion Center Coal Mining Co57,59955,27358,473Fallen Timber Coal Co74,46758,46359,399The Commissioner refused to allow said expenditures as ordinary and necessary business expenses.  OPINION.  LOVE: The above expenditures were proper charges to capital account and not deductible as ordinary and necessary expenses.  ; ; . The deficiency is $3,649.57 for the calendar year 1920.  Order will be entered accordingly.