Summitt v. Commissioner
United States Tax Court
P-H is a 10-percent shareholder in S, an S corporation. On Sept. 23, 2002, S paid premiums to acquire two major foreign currency options from B and received premiums when it sold two written minor foreign currency options to B. The purchased major foreign currency options were a reciprocal put and call, exactly offsetting each other. The written minor foreign currency options also were a reciprocal put and call, exactly offsetting each other.
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P-H is a 10-percent shareholder in S, an S corporation. On Sept. 23, 2002, S paid premiums to acquire two major foreign currency options from B and received premiums when it sold two written minor foreign currency options to B. The purchased major foreign currency options were a reciprocal put and call, exactly offsetting each other. The written minor foreign currency options also were a reciprocal put and call, exactly offsetting each other. On Sept. 25, 2002, S assigned the major foreign currency call option and the minor foreign currency call option to a charity pursuant to an assignment…
1Opinion of the Court
OPINION
Haines, Judge:
This case is before the Court on respondent’s motion for partial summary judgment pursuant to Rule 121. Respondent raises two issues for decision in his motion: (1) Whether under the marked-to-market rules of section 1256 J. Summitt, Inc. (Summitt), an S corporation, recognized loss upon its assignment to charity of a major foreign currency call option, and (2) whether Summitt was required to include in its income, upon its assignment to charity of a minor foreign currency call option, the premium it received as writer of that option.
The following facts are based upon the…
2Cases cited17 opinions
- United States v. Ron Pair Enterprises, Inc.Supreme Court of the United States · 1989
- United States v. American Trucking AssociationsSupreme Court of the United States · 1940
- Sundstrand Corporation v. Commissioner of Internal RevenueCourt of Appeals for the Seventh Circuit · 1994
- Sundstrand Corp. v. CommissionerUnited States Tax Court · 1992
- United States v. WellsSupreme Court of the United States · 1931
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