Of Course, Inc. v. Commissioner
United States Tax Court
Petitioner deducted as ordinary and necessary business expenses legal fees incurred in the sale of all of its assets. Said sale occurred during a corporate liquidation coming within the provisions of sec. 337, I.R.C. 1954. An appeal from the decision in this case lies solely to the Fourth Circuit, which has decided that such fees are deductible.
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Petitioner deducted as ordinary and necessary business expenses legal fees incurred in the sale of all of its assets. Said sale occurred during a corporate liquidation coming within the provisions of sec. 337, I.R.C. 1954. An appeal from the decision in this case lies solely to the Fourth Circuit, which has decided that such fees are deductible. Pridemark, Inc. v. Commissioner, 345 F. 2d 35 (C.A. 4, 1965), reversing on this issue 42 T.C. 510 (1964). Held, petitioner is entitled to deduct the legal fees because, even though we disagree with Pridemark, we are obliged to follow its holding.…
1Opinion of the Court
OPINION
FoeresteR, Judge:
Respondent has determined deficiencies in petitioner’s Federal income tax as follows:
TYE Amount
Jan. 28, 1967_$4, 329. 96
Feb. 3, 1968_12,143.49
All of the facts are found as stipulated, and because of concessions, the sole issue presented for our decision concerns the year ended February 3,1968. It is whether, in a corporate liquidation made pursuant to the provisions of section 337,1 legal expenses incurred 'by a corporation in the sale of its capital assets may be deducted as ordinary and necessary business expenses.
Petitioner, Of Course, Inc. (formerly the Isaac…
2Cases cited15 opinions
- Jack E. Golsen and Sylvia H. Golsen v. Commissioner of Internal RevenueCourt of Appeals for the Tenth Circuit · 1971
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- Harrison E. Spangler and Myrtle B. Spangler v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1963
- Spreckels v. CommissionerSupreme Court of the United States · 1942
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