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TAXPAYER BEATS IRS' DEAD HORSE

November 09, 2006

Tax Court Judge Holmes manages to tie up a messy case in a pithy way:

In December 1997, Raymond Murphy sent a check to Philip Hunt for $225,000. Murphy says the check was for interest that he owed Hunt on two living horses; the Commissioner says the check was a repayment of principal on a dead one. If Murphy is right, the entire amount is deductible; if he isn't, none is.

The ruling? Murphy's right, it's deductible.

Cite: Raymond T. Murphy, T.C. Memo 2006-243.

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