Gpd, Inc. v. Commissioner of Internal Revenue

PHILLIPS, Chief Judge.

The question presented in this appeal is whether the taxpayer corporation was “formed or availed of for the purpose.,of avoiding the income tax with respect to its shareholders ... by permitting earnings and profits to accumulate instead of being divided or distributed” for the year 1968. Stated differently, is the taxpayer corporation subject to the accumulated earnings tax imposed by § 531 of the Internal Revenue Code of 1954 for the year 1968. 1

In an opinion reported at 60 T.C. 480 (1973), the Tax Court held that the taxpayer corporation was subject to the accumulated…