*1231 ORDINARY AND NECESSARY EXPENSES. - Dues on exchange seats carried purely as an investment are not deductible.
*1122 The Commissioner determined deficiencies in income tax against each petitioner for the years 1936 and 1937 in the amounts of $124.40 and $148.68. The only issue for decision is whether the petitioners are entitled to deduct dues paid on exchange memberships held for investment and not for use.
FINDINGS OF FACT.
The petitioners are husband and wife, residing in New Orleans, Louisiana.
The husband owned seats on the following exchanges and paid the dues shown:
| Dues paid | ||
| Exchange | 1936 | 1937 |
| Chicago Board of Trade | $330.50 | $486.50 |
| New York Cotton Exchange | 920.00 | 822.00 |
| New York Produce Exchange | 346.00 | 292.00 |
| Commodity Exchange | 250.00 | 301.00 |
| Total | 1,846.50 | 1,901.50 |
The exchanges used the dues to pay current operating expenses.
The petitioners owned and held the seats purely as an investment and not for the purpose of dealing on the exchanges.
*1123 The dues were not paid as*1232 an expense of any business regularly carried on by the petitioners.
OPINION.
MURDOCK: The petitioners must show that the payments come within some provision of the statute allowing a deduction. . This they have failed to do. If the seats were used in a business regularly carried on by them, the cases cited would be in point. Carrying charges, such as interest and taxes, are deductible because there is a specific statutory provision allowing them. But there is no such provision covering these dues. The record does not show that the petitioners had any business of which these were an ordinary and necessary expense. .
Decision will be entered for the respondent.