
    Commercial Furniture Co., Petitioner, v. Commissioner of Internal Revenue, Respondent.
    Docket No. 6507.
    Promulgated September 15, 1927.
    
      Paul F. Myers, Esq., for the petitioner.
    
      G. H. Curl, Esq., for the respondent.
   SteRNIíagen :

This proceeding involves a deficiency of $3,171.94 for 1919, the portion in controversy arising from the respondent’s action in disallowing alleged losses upon the sale and destruction of certain houses.

FINDINGS OF FACT.

The petitioner is an Illinois corporation with its principal place of business in Chicago, at 2739 West Chicago Avenue, in or near an Italian settlement.

In May, 1919, the petitioner purchased three houses and lots at 2706, 2708, and 2710 West Superior Street, immediately contiguous to its property on the east.

The house at 2706 was a two-story brick dwelling. For this house and lot petitioner paid $2,450.

The house at 2708 was a three-story frame dwelling. For this house and lot petitioner paid $2,150.

The house at 2710 was a two-story frame dwelling. For this house and lot petitioner paid $1,850.

In addition to these amounts the petitioner paid $454.94 as expenses incidental to the transfer of title.

At that time the value of the lots alone was not in excess of $1,000 each. The petitioner in making the purchases estimated it was paying $3,000 for the lots, exclusive of the improvements thereon, and considered that the balance of the purchase price was paid for the dwelling houses thereon.

' At the time of the purchase of these properties building costs were higher than they had been, and it was the petitioner’s intention to sell the dwellings for removal to other vacant property in the neighborhood, at prices, in each instance, in excess of the portion of the purchase price allocated to the dwellings.

Within a few days after their purchase the houses were broken into and stripped of all plumbing, piping, and fixtures of every kind. About June 1, 1919, the house at 2708 burned.

An offer of $375 was received for the house at 2706, but was refused. It was found, however, that the cost of repairing and moving the houses and preparing foundations therefor was so great that they could not be sold as originally intended. After the houses had been stripped, vagrants and tramps began sleeping in them. Upon being requested by the police department to do something about the matter, the petitioner sold the remaining two buildings for destruction. On June 10, 1919, the house at 2710 was sold for $40, and on November 26,1919, the house at 2706 was sold for $35.

The cost of the lots was $3,211.60, and the cost of the buildings was $3,693.34. From the sale and destruction of the buildings petitioner in 1919 sustained a loss of $3,618.34.

Judgment will be entered on 15 days’ notice, wider Rule 50.

Considered by LaNsdoN and ARundell.  