
    Klau, Van Pietersom, Dunlap, Inc., Petitioner, v. Commissioner of Internal Revenue, Respondent.
    Docket No. 6881.
    Promulgated January 16, 1928.
    
      T. II. Spence, Esq., for the petitioner.
    
      A. LeRoy Deveney, Esq., for the respondent.
   OPINION.

Phillips :

The sole question before üs for determination is whether the petitioner should be allowed to deduct in 1920 the amount of an indebtedness which it charged off on its accounts as worthless in that year. The respondent admits the existence of the debt and the fact that it was charged off, denying only that the petitioner ascertained the indebtedness to be worthless. Upon this issue the petitioner submitted its testimony which disclosed that its officers were thoroughly familiar with the affairs of the Hacine Auto Tire Co. during 1920 and that due to a series of unfortunate events that company was so hopelessly involved financially that its unsecured creditors could hope to recover nothing more than a nominal amount, if anything, from the liquidation of its affairs. Having-knowledge of the facts which would lead to such a conclusion, it is our opinion that the petitioner properly charged off the account in 1920 and is entitled to deduct the amount as a debt ascertained to be worthless and charged off in that year.

There is no deficiency for 1920. The deficiencies determined by the Commissioner for the fiscal year and for the fiscal period ending in 1919 are approved.

Decision will be entered accordingly.  