Weitzner v. Commissioner

EMIL WEITZNER, PETITIONER, v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT. Weitzner v. Commissioner Docket No. 9526. United States Board of Tax Appeals 12 B.T.A. 724; 1928 BTA LEXIS 3464; June 21, 1928, Promulgated *3464 Commissioner sustained in the disallowance of claimed bad debt deduction on account of money spent by petitioner for the care of his father in a sanitarium. Benjamin Harrow, Esq., for the petitioner. J. L. Deveney, Esq., for the respondent. ARUNDELL *724 The petitioner alleges error on the part of respondent in disallowing a claimed bad debt deduction which resulted in the determination of a deficiency in income tax in the amount of $194.47 for the calendar year 1921. The facts were stipulated. FINDINGS OF FACT. In 1921 the petitioner expended the sum of $1.967.50 for the care and treatment of his father in a sanitarium. The father was sick during the entire year of 1921. He had no assets and no earning capacity due to his illness. The payments were made by the petitioner because of the necessity of the situation. By the end of the *725 year the condition of petitioner's father was such that petitioner knew his father would never be able to repay the amounts expended. In determining the deficiency the respondent allowed the petitioner a credit of $400 on account of the dependency of his father, in addition to the credit*3465 of $2,800 claimed by petitioner in his return on account of personal exemption and credit for dependents. OPINION. ARUNDELL: It is elementary that one of the essential prerequisites to a bad debt deduction is that the debt must have an existence in fact. . There are many different transactions out of which the relation of debtor and creditor may arise and so there are many definitions of the word "debt." It is a word that is not susceptible of definition so as to fit every situation and as far as we know there has been no comprehensive judicial determination of the meaning of the word. However, in all of the definitions that are given there is the underlying thought of an obligation to pay. The existence of an obligation is the sine qua non of a debt. In the present case no such obligation can be found in the evidence. There is no showing that petitioner's father ever made any promise to pay or that he ever recognized he was under any obligation to reimburse the petitioner. The father had no assets and no earning capacity and the money spent by the petitioner bears far more the marks of a gift than of a loan. See *3466 . Judgment will be entered for the respondent.