
    H. J. Sternberg, Petitioner, v. Commissioner of Internal Revenue, Respondent.
    Docket No. 26486.
    Promulgated December 16, 1930.
    
      David Baron, Esq., Irwin V. Barth, Esq., and W. A. Helm, O. P. A., for the petitioner.
    
      T. M. Mather, Esq., for the respondent.
   OPINION.

Tbussell:

The respondent’s disallowance of the claimed bad debt deduction was based on his determination that the debt was not totally worthless at the close of the year 1922, and he points to the subsequent events happening at the close of 1923 to sustain his view.

The facts of record show that this petitioner had been engaged in business for many years prior to 1922 and that in his sound business judgment the debt was totally worthless at the close of the year 1922, at which time it was charged off. We are of the opinion that the facts as they existed at that time not only warranted petitioner’s judgment as to the worthlessness of the debt, but actually established the worthlessness beyond doubt. The petitioner may not be called upon to look into the future and foretell events which may never happen. At the close of the year 1922 the petitioner had ample yeason, based on facts, to believe that he would never recover any portion of the $19,894.60 loaned to the Brock Engineering Co., and he may not be denied a proper deduction because subsequent events occur in his favor.

We are of the opinion that petitioner was entitled to a deduction of $19,894.60 from his gross income for the year 1922, pursuant to section 214 (a) (7) of the Eevenue Act of 1921.

Judgment will be entered pursuant to Rule 50.  