Phoenix Development Co. v. Commissioner

Decided September 19, 1928

United States Board of Tax Appeals · decided 1928-09-19

Legal expenses incurred by petitioner in defending its title to lands against adverse claimants are not deductible as ordinary and necessary expenses paid or incurred during the taxable year in carrying on its business.

Relies on Holeproof Hosiery Co. v. Commissioner · Consolidated Mut. Oil Co. v. Commissioner · Bugher v. Commissioner

Good law ✅— No negative treatment on recordhow we know

Decided 1928-09-19

How this case has been cited

Cited by 8 later decisions — most recently February 1941

1 federal appellate ·

Later decisions citing this case, by decade. The current decade is in progress, and our corpus holds fewer opinions from the most recent years, so the latest bars are undercounted — not a real decline.

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¶1 *415OFINION.

Littleton:

¶2Similar questions have been decided by this Board, and in accordance with our previous opinions on the same subject, we hold that the Commissioner committed no error in disallowing as he did the deduction of which petitioner complains.

¶3The cost of defending title to property is a capital expenditure. North American Oil Consolidated, 12 B. T. A. 68; Holeproof Hosiery Co., 11 B. T. A. 547; Bugher, et al., Executors, 9 B. T. A. 1155; West End Consolidated Mining Co., 3 B. T. A. 128; Consolidated Mutual Oil Co., 2 B. T. A. 1067; Laemmle v. Eisner, 275 Fed. 504; 2 Am. Fed. Tax Rep. 1525.

¶4Judgment will be entered for the respondent.