- 31 - Like the taxpayer in Fall River Gas Appliance Co., petitioner believed that by launching the RIC's it would derive a continuing economic benefit.13 The expenditures at issue bear other indicia of capital expenditures. The right to market the investment concept, obtained through the process of executing the contract with the individual RIC14 and filing with the SEC and individual States, is similar to the rights obtained by the taxpayers in P. Liedtka Trucking, Inc. v. Commissioner, 63 T.C. 547 (1975), and Surety Ins. Co. v. Commissioner, T.C. Memo. 1980-70. In P. Liedtka Trucking, Inc. v. Commissioner, supra, the taxpayer, a trucking business, incurred legal fees in connection with the acquisition of a Certificate of Public Convenience and Necessity issued by the Interstate Commerce Commission (ICC), which was required in order to use several routes between various points in New York, New Jersey, and Pennsylvania. The taxpayer deducted these costs as an ordinary expense. We held that the costs incurred in 13See Union Mut. Life Ins. Co. v. United States, 570 F.2d 382, 392 (1st Cir. 1978) ("expenditures made with the contemplation that they will result in the creation of a capital asset cannot be deducted" even though those expenditures were found to be regularly occurring and did not actually result in the acquisition of an asset.) 14On brief, petitioner states: "The [management] contract provides the petitioner with nothing more than an opportunity to try to attract investment to the fund." Petitioner further states: "The use of the mutual fund as an intermediary mechanism between an advisor, such as the petitioner, and individual investors is dictated by the practicalities of the market."Page: Previous 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 Next
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