Haffenreffer Brewing Co. v. Commissioner

1. Preferred stock issued by a corporation at the time of its organization which had no fixed retirement date and on which dividends were to be paid only out of earnings, held, not to constitute an indebtedness of the corporation within the meaning of either section 23(b) or section 351(b)(2)(B) of the Revenue Act of 1934. 2. By virtue of an agreement dated June 23, 1930, petitioner was required to set aside a protion of its earnings in a sinking fund and had the right to apply the sinking fund to the redemption of its preferred shares at par, plus accumulated interest, or to purchase them at…