May Hosiery Mills, Inc. v. Commissioner
United States Board of Tax Appeals
Petitioner, during the taxable year paid out $49,165.51 in purchase of shares of its preference stock Pursuant to an agreement by which it was required to set aside 15 percent of its net profits and apply them to the retirement of such stock.
Read the full summary
Petitioner, during the taxable year paid out $49,165.51 in purchase of shares of its preference stock Pursuant to an agreement by which it was required to set aside 15 percent of its net profits and apply them to the retirement of such stock. Held, petitioner is not entitled to a credit, under section 26(c)(2) of the Revenue Act of 1936, of the amount of either the profits required to be set aside or the amounts spent retiring the preference stock; held, further, petitioner may not claim a dividends-paid credit under section 27(f) of the Revenue Act of 1936 for that part of the $49,165.61…
1Opinion of the Court
*648OPINION.
AruNdeil:
The petitioner seeks redetermination of the deficiency here in question on three different bases, each involving a different aspect of the same transaction. The first two stem from the requirement that 15 percent of the petitioner’s net income annually be set aside in a sinking fund and applied to the purchase or redemption of its preference stock. Petitioner argues that this provision of the agreement of August 19,1927, brings within section 26 (c) (2) of the Eevenue Act of 19861 (1) the amount of $51,189.68 which was required during the taxable year to be set aside in the…
2Cited by4 opinions
- Haffenreffer Brewing Co. v. Commissioner of Int. Rev.Court of Appeals for the First Circuit · 1940
- May Hosiery Mills v. Commissioner of Internal Rev.Court of Appeals for the Fourth Circuit · 1941
- H. H. King Flour Mills Co. v. United StatesDistrict Court, D. Minnesota · 1971
- May Hosiery Mills, Inc. v. CommissionerUnited States Board of Tax Appeals · 1940