Quimbee logo
DMCA.com Protection Status
From our private database of 16,300+ case briefs...

Stephen P. Wasnok v. Commissioner

United States Tax Court
30 T.C.M. 39 (1971)


In 1960, Stephen P. Wasnok and his wife, Mary Alice Wasnok (plaintiffs), purchased a home in Ohio. To make the purchase, they obtained a loan secured by a mortgage on the home from Spring Grove Avenue Loan and Deposit Company (Spring Grove). In 1961, the Wasnoks moved to California. They unsuccessfully attempted on several occasions to sell the Ohio home. Being unable to sell, the Wasnoks rented the home from 1961–65 for $200 per month. On their tax returns, the Wasnoks reported the rental income and took depreciation deductions on the home. Eventually, the Wasnoks became unable to pay the monthly mortgage payments to Spring Grove and, in 1965, the Wasnoks deeded the home to Spring Grove in satisfaction of their remaining balance of $24,421.04. The Wasnoks’ cost basis in the home was $32,729.70. By 1965, they had taken $4,697.42 in depreciation deductions, resulting in an adjusted basis of $28,032.28. After deeding the home back to Spring Grove for $24,421.04, the Wasnoks sustained a $3,611.24 loss on their home. Thereafter, the Wasnoks had gross income of $5,603.21 and $3,180.00 in 1965 and 1966 respectively. They did not file income tax returns for those years because they did not owe any taxes. In 1967, the Wasnoks claimed a capital loss carry-forward deduction of $2,000.00 based on the loss on the home sustained in 1965. In 1968, they claimed another capital loss carry-forward deduction of $389.00. The Commissioner (defendant) disallowed the capital loss carry-over deductions. Rather, the Commissioner characterized the loss as an ordinary loss that was entirely deductible in 1965.

Rule of Law


Holding and Reasoning (Sacks, J.)

What to do next…

  1. Unlock this case brief with a free (no-commitment) trial membership of Quimbee.

    You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 97,000 law students since 2011. Some law schools—such as Yale, Vanderbilt, Berkeley, and the University of Illinois—even subscribe directly to Quimbee for all their law students. Read our student testimonials.

  2. Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.

    Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students. Read more about Quimbee.

Here's why 370,000 law students have relied on our case briefs:

  • Written by law professors and practitioners, not other law students. 16,300 briefs, keyed to 223 casebooks. Top-notch customer support.
  • The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
  • Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
  • Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.

Questions & Answers

Have a question about this case?

Sign up for a free 7-day trial and ask it

Sign up for a FREE 7-day trial