Kind v. Commissioner
United States Tax Court
On May 31, 1962, petitioner had his wholly owned corporation liquidated, and he thereafter operated its business as a sole proprietorship. For reasons arising subsequent to the liquidation, petitioner created a new corporation on Jan. 2, 1963, transferring to it the operating assets of the proprietorship.
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On May 31, 1962, petitioner had his wholly owned corporation liquidated, and he thereafter operated its business as a sole proprietorship. For reasons arising subsequent to the liquidation, petitioner created a new corporation on Jan. 2, 1963, transferring to it the operating assets of the proprietorship. Held, the distribution to petitioner of the assets of the original corporation was in complete liquidation thereof within the meaning of sec. 331(a), I.R.C. 1954, and is not taxable as a dividend under sec. 301, I.R.C. 1954, or as "boot" arising out of a reorganization defined in sec. 368(a)…
1Opinion of the Court
OPINION
Section 331(a)(1) 1 provides that amounts distributed in complete liquidation of a corporation “shall be treated as in full payment in exchange for the stock.” The effect of this provision is to tax the gain included in a distribution on the liquidation of a corporation at capital gain rates if the stock was held for more than 6 months. Secs. 1201, 1222. In contrast, section 316(a) broadly defines the term “dividend” to include “any distribution of property made by a corporation to its shareholders” out of its earnings and profits, and section 301(c) (1) provides that any distribution…
2Cases cited19 opinions
- Commissioner v. CulbertsonSupreme Court of the United States · 1949
- United States v. Cumberland Public Service Co.Supreme Court of the United States · 1950
- J. E. Davant and Kathryn Davant v. Commissioner of Internal Revenue, Commissioner of Internal Revenue v. J. E. Davant and Kathryn DavantCourt of Appeals for the Fifth Circuit · 1966
- South Texas Rice Warehouse Co. v. CommissionerUnited States Tax Court · 1965
- Weir Long Leaf Lumber Co. v. CommissionerUnited States Tax Court · 1947
14 more not listed; retrieve them via the Exa API.
3Cited by19 opinions
- Yamamoto v. CommissionerUnited States Tax Court · 1980
- Gray v. CommissionerUnited States Tax Court · 1971
- Vest v. CommissionerUnited States Tax Court · 1971
- Charles L. Long and Ruth S. Long v. United StatesCourt of Appeals for the Sixth Circuit · 1981
- Kansas Sand & Concrete, Inc. v. CommissionerUnited States Tax Court · 1971
14 more not listed; retrieve them via the Exa API.