
    Henry S. Thompson, Petitioner, v. Commissioner of Internal Revenue, Respondent.
    Docket No. 29374.
    Promulgated February 14, 1930.
    
      Howard W. Brown, Esq., for the petitioner.
    
      W. F. Gibbs, Esq., for the respondent.
   OPINION.

Smith :

The only question involved in this proceeding is the petitioner’s right to deduct the amounts of $6,000 and $7,500 representing the notes of his brother and sister.

Section 214 (a) (7) of the Bevenue Act of 1924 permits the deduction from gross income of debts ascertained to be worthless and charged off within the taxable year. In Avery v. Commissioner, 22 Fed. (2d) 6, the court stated that this section of the statute contemplated the deduction of bad debts within the year in which they were ascertained or reasonably should have been ascertained to be worthless and that “ a taxpayer should not be permitted to close his eyes to the obvious, and to carry accounts on Ms books as good when in fact they are worthless, and then deduct them in a year subsequent to the one in which he must be presumed to have ascertained their worthlessness.”

The. evidence, to our mind, does not show that the debts in question were of any less value in 1924 than in many of the prior years of their existence or that the petitioner had any more reasonable grounds for considering them uncollectible in the year 1924 than he had in prior years. There was no change in the financial condition of the debtors in the year 1924. They had never been able to pay the notes given by them and the petitioner had continued to give them financial assistance after their graduation from college.

The petitioner submits that the worthlessness of the notes in 1924 was evidenced by the fact that his brother and sister had reached the ages of 47 and 50, respectively, without ever having been able to pay any part of their obligations. This fact does not, however, prove that the notes were any more uncollectible in 1924 than in prior years.

Judgment will be entered for the respondent.  