
    Simon Kohn, Petitioner, v. Commissioner of Internal Revenue, Respondent.
    Docket No. 13169.
    Promulgated October 6, 1927.
    Where no facts were ascertained in 1921 relating to the worthlessness of a debt, they being known in prior years, the petitioner is not entitled to a deduction in that year on account of a debt ascertained to be worthless although it was charged off in that year.
    
      
      Simon Kohn pro se.
    
      A. H. Murray, Esq., for the respondent.
    This is a proceeding for the redetermination of a deficiency in income tax for the calendar year 1921 in the amount of $333.04. The deficiency arises on account of the action of the Commissioner in disallowing as a deduction the amount of a debt claimed by the petitioner to have been ascertained to be worthless and charged off during the taxable year.
    FINDINGS OF FACT.
    The petitioner, on December 2, 1913, loaned his brother, Adolf Kohn, $2,370. He agreed that the interest on this money should be paid to the debtor’s wife. Adolf Kohn lived in Germany and during 1914 and 1915 was in serious financial circumstances. His financial circumstances remained in that condition until 1921 when the petitioner made an entry on his books of account charging the amount to profit and loss on December 30 of that year. The petitioner ascertained no facts relating to the indebtedness or the ability of the debtor to pay or the probability of payment in 1921, which had not been ascertained prior thereto.
   OPINION.

Trammell :

In order for the petitioner to be entitled to the deduction claimed it is incumbent upon him to introduce evidence to show that the indebtedness was ascertained to be worthless and charged off within the taxable year. There is no evidence that the debtor was in worse financial condition in 1921 than he was in years prior thereto. Nothing occurred during that year which would indicate that it was any more uncollectible at that time than in 1920 or at any period since 1914. The only evidence relating to the indebtedness, insofar as the year 1921 was concerned, was the charge-off. If the debtor had no assets and could not pay the debt in 1914 or 1915, or in any other year prior to 1921, and that fact was ascertained by the petitioner, he was not permitted to wait until 1921 in order to make the charge-off of the account where no additional facts were ascertained in 1921.

In view of the evidence, we are not convinced that the petitioner ascertained the debt to be worthless in 1921. He is accordingly not entitled to the deduction claimed.

Reviewed by the Board.

Judgment will be entered for the respondent.  