Sun Pipe Line Co. v. Commissioner
United States Board of Tax Appeals
Debentures were issued by a personal holding company prior to January 1, 1934. After that date they were retired with the proceeds of new debentures issued at a lower rate of interest and sold to parties other than those who had held the first issue.
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Debentures were issued by a personal holding company prior to January 1, 1934. After that date they were retired with the proceeds of new debentures issued at a lower rate of interest and sold to parties other than those who had held the first issue. Held, that amounts of income used by the corporation in a later year to retire the second bond issue were used to retire indebtedness incurred prior to January 1, 1934, within the purview of section 351(b)(2)(B), Revenue Act of 1936, as amended by section 355(b), Revenue Act of 1937.
1Opinion of the Court
*1416OPINION.
Disney:
Stated tersely, the problem for solution here is whether section 351 (b) (2) (B) of the Revenue Act of 1936, as amended by section 355 (b) of the Revenue Act of 1937,1 by the phrase “indebtedness incurred prior to January 1, 1934”, was intended to cover indebtedness which existed prior to that date in the form of debentures and was retired after the crucial date, new bonds being issued for cash and the proceeds being used to retire the old debentures. In a word, the facts before us are that 5 percent bonds were issued in 1930 to certain parties and were retired in 1934 with the…
2Cases cited4 opinions
- City of Huron v. Second Ward Sav. BankCourt of Appeals for the Eighth Circuit · 1898
- City of Los Angeles v. TeedCalifornia Supreme Court · 1896
- City of Poughkeepsie v. . QuintardNew York Court of Appeals · 1892
- Ætna Life Ins. v. Lyon CountyU.S. Circuit Court for the District of Northern Iowa · 1897
3Cited by6 opinions
- Addressograph-Multigraph Corp. v. Comm'rUnited States Tax Court · 1945
- General Plastics, Inc. v. CommissionerUnited States Tax Court · 1943
- Motor Products Corp. v. CommissionerUnited States Board of Tax Appeals · 1942
- Piermont Corp. v. CommissionerUnited States Board of Tax Appeals · 1941
- Raritan Co. of Delaware v. CommissionerUnited States Board of Tax Appeals · 1942
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