Floyd R. Clodfelter and Enna L. Clodfelter v. Commissioner of Internal Revenue

Floyd R. Clodfelter and his wife, Enna, petition for review of an order and decision of the Tax Court of the United States which determined they were liable for a deficiency of $219,590.50 in payment of federal income taxes for the year 1957. The liability is said to result from a series of transactions involving the Waldorf Hotel located in Seattle, Washington. The decision of the Tax Court is reported at 48 T.C. 694 . Our jurisdiction is properly invoked under Section 7482 of the Internal Revenue Code of 1954, 26 U.S.C. § 7482 .

The legal issues for decision are as follows:

The Commissioner found that there was a sale as of January 1, 1957, that it resulted in a short term gain and that the taxpayers were not entitled to use the installment method in reporting that gain. The Tax Court reviewed the transactions and arrived at the same conclusions. We hold that the determinations made by the Tax Court are not clearly erroneous and therefore affirm. See Commissioner of Internal Revenue v. Duberstein, 363 U.S. 278, 291 , 80 S.Ct. 1190 , 4 L.Ed.2d 1218 (1960).

Many of the facts are the result of stipulation. They disclose that the taxpayers on July 1, 1951 acquired the lessees’…