Hovely v. Commissioner , 2 B.T.A. 1099 ( 1925 )

APPEAL OF PETER P. HOVELY.

Hovely v. Commissioner

Docket No. 1677.

United States Board of Tax Appeals

2 B.T.A. 1099; 1925 BTA LEXIS 2145;

October 30, 1925, Decided Submitted July 9, 1925.

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Raymond R. Hails, Esq., for the taxpayer.

John D. Foley, Esq., for the Commissioner.

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Before GRAUPNER, TRAMMELL, and PHILLIPS.

The taxpayer appeals from the determination of a deficiency of $200.39 in income tax for the calendar years 1918 and 1919. The petition also contains an allegation of error as to an overassessment for 1917, but at the hearing the taxpayer waived that allegation. The deficiencies for 1918 and 1919 arise from the reduction by the Commissioner in the rate of depreciation claimed on a number of buildings.

FINDINGS OF FACT.

1. The taxpayer is an individual and, during the years here involved, resided at Brawley, in the Imperial Valley, Calif.

2. Depreciation rates on buildings of frame construction were claimed in the returns filed and were allowed by the Commissioner as follows:

1918
	Constructed	Acquired by	Cost	Rate	Rate
		taxpayer		claimed	allowed
				Per cent	Per cent
(a) Frame cottage	About 1912	1912 or 1913	$2,196.80	6 2/3	4
(b) Frame residence	About 1908	1912 or 1913	1,200.00	10	4
(c) Frame residence	About 1908	1913 or 1914	850.00	10	4
(d) Frame residence	About 1910	1917	750.00	10	4
(e) Tenant house,	First buildings
tank house, stock	constructed
building.	about 1912 by
	taxpayer.		7,574.75	10	4

1919
	Cost	Rate claimed	Rate allowed
		Per cent	Per cent
(a) Frame cottage	$2,598.00	6 2/3	4
(b) Frame residence	1,200.00	10	4
(c) Frame residence	850.00	10	4
(d) Frame residence	750.00	10	4
(e) Tenant house, tank house, stock buildings, etc	7,574.75	10	4

3. All of the buildings described in the above schedule are of wooden construction throughout. The excessive heat of the Imperial Valley and seasonal changes in temperature cause more or less expansion and contraction and cause shingles to curl and roofs, windows, doors, and frames to warp. The changes in temperature in the locality in which these buildings are located are gradual. Without repairs or replacements the useful life of frame buildings is from 10 to 15 years, but with repairs and replacements the useful life extends over a longer period.

4. The taxpayer's buildings here involved had a remaining useful life from the date he acquired them, as listed below:

	Date acquired	Useful life from date of acquisition
		Years
(a) Frame cottage	1912	20
(b) Frame residence	1912	16
(c) Frame residence	1913	15
(d) Frame residence	1917	13
(e) Tenant house, etc	1912	20

DECISION.

The deficiency should be computed in accordance with the above findings of fact. Final determination will be settled on consent or on 15 days' notice, in accordance with Rule 50.