Gueydan v. Commissioner

*1251OPINION.

Smith

: The Revenue Act of 1918 permits an individual taxpayer to deduct from gross income “ debts ascertained to be worthless and charged off within the taxable year.” Section 214(a)(7). It will be noted from the foregoing that the statute prescribes two conditions before debts claimed to be worthless may be deducted from gross income in an individual tax return — first, that they must be ascertained to be worthless, and, secondly, that they must be charged off within the taxable year. Although the petitioner may have had reason to believe that he would never collect a large part of his advances to rice farmers during the year 1919, we do not consider that there was such an ascertainment of worthlessness of the ac~ *1252counts as is contemplated by the statute. Furthermore, there was no charging off of the debts by the petitioner.

Judgment for the Commissioner.