1936 BTA LEXIS 703 | B.T.A. | 1936
Lead Opinion
The respondent disallowed the petitioner’s claimed deduction of his contribution to Symes Foundation on the ground that the Foundation does not come within the purview of section 23 (n) of the Revenue Act of 1932. The cited section allows deductions for gifts to any fund or foundation organized and operated exclusively for religious, charitable, or educational purposes.
The matter of a deduction of a contribution to Symes Foundation was before us in a proceeding brought by this petitioner in Docket No. 76293. That proceeding involved the year 1931. There the respondent had allowed the deduction and by amended answer alleged that he erred in so doing. In o-ur opinion in that case we held the respondent’s evidence .insufficient to affirmatively establish his case. Both parties here take the view that our prior holding is not res adjudicaba of the issue in this case. We agree with that view. Exemption once allowed does not necessarily carry over to subsequent years. Cf. D. F. Strickland, 32 B. T. A. 804. Moreover, the burden of proof in the two cases is different; in the former case the respondent had the burden of proving the Foundation not exempt, while here the petitioner is required to prove his right to a deduction.
The petitioner in this case claims that the Symes Foundation is •a charitable, educational, and religious corporation. In order to come within the above cited provision of the statute, the taxpayer must show that the recipient of his contribution is both organized and operated exclusively for the purposes specified by the statute. J. Noah Id. Slee, 15 B. T. A. 710; affd., 42 Fed. (2d) 184. It is obvious that the Symes Foundation itself was not operated exclusively for the specified purposes. It conducted no charitable, educational, or religious enterprises and gave no aid financially or otherwise to any other organization that did. Its activities were limited to clearing titles to land. If we are permitted to look beyond the Symes Foundation in search of the ultimate recipient of the property that it hopes to acquire, we are unable to find it. The charter of the Foundation does not name a recipient and the Foundation has not designated one. The statute, as we read it, is confined in its
The deductions claimed as expenses and depreciation on the Plaza Street house after its abandonment as a residence are not allowable. The statute (sec. 23 (a), Revenue Act of 1932) allows only the deduction of expenses incurred in “trade or business”, and only for depreciation of “property used in the trade or business.” (Sec. 23 (k), Revenue Act of 1932.) An abandoned residence is not converted into business property by the mere listing with an agent for rent or sale. Morgan v. Commissioner, 76 Fed. (2d) 391; Rumsey v. Commissioner, 82 Fed. (2d) 158. Cf. DeFord v. Commissioner, 29 Fed. (2d) 532; William H. Upmeyer, 22 B. T. A. 971; Frances G. Smith, 23 B. T. A. 1134; D. A. Belden, 30 B. T. A. 601.
Reviewed by the Board.
Decision will be entered under Rule 50.