- 12 -
(1988); see also Narver v. Commissioner, 75 T.C. 53, 98 (1980),
affd. 670 F.2d 855 (9th Cir. 1982). “In a number of cases, the
Court has refused to permit the transfer of formal legal title to
shift the incidence of taxation attributable to ownership of
property where the transferor continues to retain significant
control over the property transferred.” Frank Lyon Co. v. United
States, 435 U.S. 561, 572-573 (1978). “‘[T]axation is not so
much concerned with the refinements of title as it is with actual
command over the property taxed’”. Grodt & McKay Realty, Inc. v.
Commissioner, 77 T.C. 1221, 1236 (1981) (quoting Corliss v.
Bowers, 281 U.S. 376, 378 (1930)); see also United States v. W.H.
Cocke, 399 F.2d 433, 445 (5th Cir. 1968). Therefore, when a
taxpayer never actually owns the property in question, the
taxpayer is not allowed to claim deductions for depreciation.
See Grodt & McKay Realty, Inc. v. Commissioner, supra at 1236-
1238; see also Schwartz v. Commissioner, T.C. Memo. 1994-320,
affd. without published opinion 80 F.3d 558 (D.C. Cir. 1996).
A taxpayer has received an interest in property that
entitles the taxpayer to depreciation deductions only if the
benefits and burdens of ownership with respect to the property
have passed to the taxpayer. See Grodt & McKay Realty, Inc. v.
Commissioner, supra at 1237-1238; see also Grant Creek Water
Works, Ltd. v. Commissioner, supra at 326. Whether the benefits
and burdens of ownership with respect to property have passed to
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