
    E. G. Tucker, Petitioner, v. Commissioner of Internal Revenue, Respondent.
    Docket No. 7863.
    Promulgated October 11, 1928.
    
      Clyde A. Morwood, C. P. A., for the petitioner.
    
      J. E. Marshall, Esq., for the respondent.
   OPINION.

Siefkin :

The sole question to be decided in this case relates to the value of certain real property which the petitioner received among other things in 1921, in exchange for 150 shares of the capital stock of the Tucker-Ferguson Warehouse & Transfer Co.

The evidence in the case is not clear as to the status of the ownership of this property at the time of the transaction, but the petitioner having raised no objection to its inclusion by the respondent among the assets received in exchange for capital stock, we are concerned only with the value thereof as established by the evidence in this case.

This real property was carried upon the books of the corporation at a value of $30,000 and was subject to a mortgage of $12,000. The projierty consists of a lot 200 by 450 feet in size and a warehouse building thereon about 40 by 150 feet in size. The building is an old, one-story building having no basement, and is of wood, concrete and sheet metal construction. . It is located upon an unpaved street and the distance to a paved street is two blocks. It is unsuitable for any use except as a warehouse. It is connected with the railroad by a spur track.

As a part of the transaction the petitioner leased the property in question to the Springfield Warehouse Co. for a period of 18 months at $300 per month. When this contract expired the petitioner received a rental on the property of $250 per month for one year. Later the rental received was $150 per month.

One of the petitioner’s witnesses testified that the lot and building was worth about $17,500 in 1921. Another witness testified that at that time the building was worth from $6,500 to $7,000 and that the ground was worth $20 per front foot. The frontage of the lot was 450 feet. This witness stated that the whole property had a total value of about $15,000 in 1921. His valuation is an investment valuation entirely. The petitioner testified that he has offered the property for sale for a number of years but has never been able to sell it. Petitioner testified that he has been willing to sell it for $15,000.

From all of the evidence in the case, it is our opinion that the property in question had a value at the time acquired by the petitioner of $17,500. Since the property was encumbered by a mortgage of $12,000, which the petitioner assumed, the net value of the property to the petitioner was $5,500.

Judgment will he entered under Rule 50.  