T.C. Memo. 2003-81 UNITED STATES TAX COURT PETER U. AND MARY M. BOEHME, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent Docket No. 6668-00. Filed March 20, 2003. M (who together with her husband, P, filed joint returns for the audit years) assigned her right to receive certain future annual lottery payments in exchange for a lump-sum payment to her by W of $400,000. M used $250,000 of the $400,000 to repay loans to M, which had been secured by the future annual lottery payments. Of the $250,000, $186,000 represented repayment of the outstanding principal amount of the loans and the $64,000 balance qualified as the payment of interest. 1. Held: M’s right to receive certain future annual lottery payments does not constitute a capital asset. Davis v. Commissioner, 119 T.C. 1 (2002) followed. 2. Held, further, the $400,000 that M received from W is ordinary income.Page: 1 2 3 4 5 6 7 8 9 10 11 12 13 Next
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