Loy D. Mercer v. Commissioner of Internal Revenue

This is a petition to review a decision of the Tax Court of the United States. That Court had jurisdiction of the case. ( 26 U.S.C. § 6213 .) We have jurisdiction of the petition for review under 26 U.S.C. § 7482 .

Petitioner Loy Mercer and his older brother Berle were raised on a cattle ranch in Nebraska, where they learned the rudiments of the cattle business. In 1957 Berle moved to Alaska with his family and a herd of cattle. He acquired a ranch in the interior of Alaska and began attempting to ranch for profit. Due to the severity of the climate the cattle he had brought with him did not fare well. Cross-breeding, however, has improved the animals’ ability to survive and reproduce in that part of Alaska. Berle has been building his herd and hopes to make a profit in the future on his cattle operations.

Petitioner Loy Mercer moved to Alaska in 1958 where he continued his collége education. Before moving to Alaska he had owned some Angus cattle. These were traded for six Angus-Highland cattle, which it was thought would survive better in the Alaska climate. The six Nebraska Angus-Highland cattle were shipped to Alaska and Loy took them to Berle’s ranch. Loy attempted to obtain…