Jacob Conn, Petitioner, v. Commissioner of Internal Revenue, Respondent

Jacob Conn, Petitioner, v. Commissioner of Internal Revenue, Respondent. Docket No. 11978. Promulgated April 18, 1929. William A. Needham, Esq., for the petitioner. L. L. Eight, Esq., for the respondent. [MAJORITY — TRtjssell :] OPINION. TRtjssell : The testimony in this case clearly establishes that petitioner during the calendar year 1919 had no sources of interest income other than that credited upon his bank-deposit balances and that such credits were not in excess of $150. It also establishes that certain expenses of operating his theatre for the purpose of various supplies for such business aggregated $1,412.04, making a total expense of such theatre operations $39,665.18. The issue in respect to exhaustion of leasehold is whether the modification of the original lease agreement on January 1, 1921, so reduced the period of the original lease as to warrant, for the year 1919, an exhaustion deduction on the basis of 5 years and 15 days instead of 8 years and 15 days. To our minds the record clearly establishes that the lease term acquired and for which the $15,000 purchase money was paid, covered a period of 8 years and 15 days and that the exhaustion deduction should be computed upon that basis. Judgment will be entered pursuant to Buie 60.