McGrath v. Commissioner , 6 B.T.A. 1089 ( 1927 )

OPINION.

Geeen :

The evidence adduced as to the proper rate of depreciation is not sufficient to enable us to determine the correct rate. There is evidence as to the life of some of the buildings, but except as to those added after the purchase there is no evidence as to their cost and there is no testimony relating specifically to those buildings as to which there is evidence of cost. Upon such a record we must affirm the rate of 10 per cent adopted by the Commissioner.

The gain on the sale should be computed by adding to the purchase price the cost of the improvements, which we have found to be $1,590; deducting from this amount depreciation at the rate of 10 per cent, and subtracting the amount so obtained from the sales price. The amount of $210 expended in the purchase of alfalfa seed may properly be added to the basis for gain or loss but for lack of evidence may not be included as a basis for depreciation.

The rate of depreciation used by the Commissioner, namely, 33^ per cent, should be applied to the cost of the automobile, which we have found to be $2,100. This results in an increase in the deduction in the sum of $200.

Judgment will be entered after 15 days' notice, under Rule 50.