TAXATION - INCOME TAX - INTEREST ON CONDEMNATION AWARD AS CAPITAL GAIN

Petitioner's land was condemned by the city of New York and as compensation he was awarded a certain sum representing the value of the land and, in addition, a sum classified as "interest" to indemnify the petitioner for delay in payment of the award. The award so classified as "interest" was taxed as "ordinary income" by the commissioner of internal revenue. It was petitioner's contention that such sum denominated as "interest" should have been classed as a "capital gain" and not as "ordinary income." From an order of the board of tax appeals holding this sum "ordinary income," petitioner appealed. Held, that portion of the award which was denominated "interest" was a part of the condemnation award and should be classed as "capital gain" and not "ordinary income." Seaside Improvement Co. v. Commissioner of Internal Revenue, (C. C. A. 2d, 1939) 105 F. (2d) 990.