Bilar Tool & Die Corp. v. Commissioner
United States Tax Court
Friction occurred between petitioner's two equal stockholders which threatened disruption of its business. Petitioner adopted a plan for dividing the business between the two stockholders which involved the formation of a new corporation to which one-half of petitioner's assets were transferred in exchange for the stock of the new corporation, which was then exchanged for the 50 percent of petitioner's stock held by one of the stockholders.
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Friction occurred between petitioner's two equal stockholders which threatened disruption of its business. Petitioner adopted a plan for dividing the business between the two stockholders which involved the formation of a new corporation to which one-half of petitioner's assets were transferred in exchange for the stock of the new corporation, which was then exchanged for the 50 percent of petitioner's stock held by one of the stockholders. Held: The identified legal expenses incurred by petitioner in connection with the plan are deductible as ordinary and necessary business expenses under…
1Opinion of the Court
Dkennen, Judge:
Respondent determined a deficiency of $5,520 in petitioner’s Federal income tax for the fiscal year ended September 30, 1967. The only issue before the Court is whether petitioner is entitled to a deduction from its gross income as ordinary and necessary business expense under section 162(a) legal expenses incurred by it in a division of its business between its two 50-percent shareholders in the tax year at bar.
FINDINGS OP FACT
The stipulated facts are found accordingly.
Petitioner, an accrual basis taxpayer, is a Michigan corporation with its principal office in Warren, Mich.…
2Cases cited12 opinions
- Woodward v. CommissionerSupreme Court of the United States · 1970
- United States v. Hilton Hotels Corp.Supreme Court of the United States · 1970
- United States v. Transamerica Corporation, Transamerica Corporation v. United StatesCourt of Appeals for the Ninth Circuit · 1968
- E. I. Du Pont De Nemours and Company v. United StatesCourt of Appeals for the Third Circuit · 1970
- Mills Estate, Inc. v. Commissioner of Internal Revenue. Commissioner of Internal Revenue v. Mills Estate, IncCourt of Appeals for the Second Circuit · 1953
7 more not listed; retrieve them via the Exa API.
3Cited by6 opinions
- National Starch & Chemical Corp. v. CommissionerUnited States Tax Court · 1989
- USFreightways Corp. v. CommissionerUnited States Tax Court · 1999
- Bilar Tool & Die Corp. v. CommissionerUnited States Tax Court · 1974
- National Starch & Chemical Corp. v. CommissionerUnited States Tax Court · 1989
- USFreightways Corp. v. CommissionerUnited States Tax Court · 1999
1 more not listed; retrieve them via the Exa API.