Bowen v. Commissioner
United States Tax Court
Husband and wife each owned stock in a publicly held corporation. Their combined ownership enabled the husband to retain control over the corporation despite an approximate 35-percent stock ownership by the wife's brother. In 1973, the wife sold her stock to her husband on the installment basis. The installment payments were to be made over a period of 40 years with a "balloon" payment due at the end of that period.
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Husband and wife each owned stock in a publicly held corporation. Their combined ownership enabled the husband to retain control over the corporation despite an approximate 35-percent stock ownership by the wife's brother. In 1973, the wife sold her stock to her husband on the installment basis. The installment payments were to be made over a period of 40 years with a "balloon" payment due at the end of that period. Subsequently, in late 1974, the husband sold to a Canadian corporation a portion of the shares purchased from his wife. This sale also was on the installment basis. In computing…
1Opinion of the Court
Sterrett, Judge:
By statutory notice dated June 8, 1979, respondent determined deficiencies in petitioners’ Federal income taxes of $158.20 and $10,724.42 for the taxable years 1973 and 1975, respectively, and an addition to tax for negligence or intentional disregard of rules or regulations in the amount of $536.22 for the 1975 taxable year. The issues presented for decision are: (1) Whether a sale of stock between petitioner-husband and petitioner-wife was a bona fide transaction entitled to recognition for Federal income tax purposes; (2) if not, whether the basis of a portion of such stock…
2Cases cited24 opinions
- Gregory v. HelveringSupreme Court of the United States · 1935
- Corliss v. BowersSupreme Court of the United States · 1930
- United States v. PhellisSupreme Court of the United States · 1921
- Griffiths v. CommissionerSupreme Court of the United States · 1939
- Grodt & McKay Realty, Inc. v. CommissionerUnited States Tax Court · 1981
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3Cited by14 opinions
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- Vaughn v. CommissionerUnited States Tax Court · 1983
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- Bowen v. CommissionerUnited States Tax Court · 1982
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