- 5 - issuing State and the ability of the holder to limit competition by exercising its right to intervene in the application process. The FAAAA eliminated the holders' right to intervene and oppose applications for new operating authorities. The parties agree that one effect of the FAAAA was to render worthless petitioner's pre-1995 operating authorities, which resulted in petitioner's sustaining an ordinary loss of $520,677. Discussion The only issue in this case is whether petitioner sustained the loss from the worthlessness of its pre-1995 intrastate operating authorities during 1994 or during 1995. Petitioner asserts that the operating authorities became worthless during 1994. Respondent determined that petitioner sustained the loss during 1995. Section 165(a) allows a deduction for any loss sustained during the taxable year and not compensated for by insurance or otherwise. To be allowable as a deduction under section 165(a), a loss must be evidenced by closed and completed transactions, fixed by identifiable events, and actually sustained during the taxable year. Substance and not mere form shall govern in determining a deductible loss. See Cottage Sav. Association v. Commissioner, 499 U.S. 554, 567-568 (1991); Boehm v. Commissioner, 326 U.S. 287, 292 (1945); sec. 1.165-1(b), (d)(1), Income Tax Regs.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 Next
Last modified: May 25, 2011