Green v. Commissioner
United States Board of Tax Appeals
The evidence establishes that stock and debentures of a new corporation, acquired in exchange for stock of an old corporation in a nontaxable reorganization, had no market value.
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The evidence establishes that stock and debentures of a new corporation, acquired in exchange for stock of an old corporation in a nontaxable reorganization, had no market value. Held, that because of the lack of market value, no allocation of basis can be made between the new stock and debentures and no gain is to be recognized on a transaction whereby the petitioners exchanged part of their new stock for the cancellation of indebtedness in amounts less than the basis of the old stock.
1Opinion of the Court
*827OPINION.
Aeundell:
The parties are in agreement as to the cost to petitioners of their Doernbecher Co. stock, and further that the exchange of that stock for Furniture Corporation stock and debentures was a nontaxable exchange. Counsel for petitioners also concedes that the transfer of Furniture Corporation stock at $20 per share in cancellation of the petitioners’ indebtedness would be a taxable transaction if it were practicable to make an allocation of basis between the stock and debentures.
It is the contention of the petitioners that it is impracticable to apportion the cost of the…
2Cited by5 opinions
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- Green v. CommissionerUnited States Board of Tax Appeals · 1935
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