The opinion
*1152 OPINION.
Black :
The contentions of the parties are fully stated in the stipulation made the basis of our findings of fact, and leave for our determination only the question of depletion.
Briefly stated, the petitioner claims that she is entitled to depletion on the basis of the fair market value of her interest in the property as of March 17, 1922, the date of the gift to her by her husband, or, in the alternative, if she is not entitled to that basis, then on a basis of the discovery value on December 30, 1921. The respondent contends that petitioner is not entitled to any depletion because she is only entitled to depletion on the original cost to the donor, or the market value on March 1, 1913, neither of which is shown in the stipulation of facts.
*1153 The deficiencies involved here are for 1922 and 1928 and are governed by the Revenue Act of 1921. We have had this question before us several times and have decided that the donee taxpayer, in circumstances similar to those in these proceedings, is entitled to a depletion allowance based on the fair market value of the property on the date the gift was made. Melville G. Thompson, 10 B. T. A. 25; Magdaline McK inney, 16 B. T. A. 804; S. B. Daniel, 16 B. T. A. 925; Lemuel Scarbrough, 18 B. T. A. 951; B. M. Blumrosen, 19 B. T. A. 240.
The case of S. B. Daniel, supra, was appealed to the Circuit Court of Appeals for the Fifth Circuit by the Commissioner, and the decision of this Board was affirmed in Lucas v. Daniel, 45 Fed. (2d) 58.
Upon authority of these decisions, we hold that petitioner is entitled to depletion based on the fair market value of her interest in the property as of March 17, 1922, the date of the gift, and that under clause 12 of the stipulation and findings of fact, she is entitled to depletion allowances of $55,478.86 for 1922 and $55,848.60 for 1923. Upon recomputation, petitioner’s income for the year 1922 should be decreased $97.58 as provided in clause 14 of the stipulation. For the year 1923 her income as shown in the deficiency letter of January 27,1928, should be decreased by $30.83, and increased by $200.21 and the additional sum of $40,638.81 as provided in clause 15 of the stipulation and in the findings of fact.
Judgment will be entered umder Rule 50.