Acro Mfg. Co. v. Commissioner
United States Tax Court
Petitioner, whose principal business was the manufacture and sale of precision switches and thermostatic controls, acquired a subsidiary engaged in the manufacture of metal buttons for work clothing by acquiring all of its outstanding capital stock solely in exchange for shares of petitioner's own voting stock. Thereafter, pursuant to an agreement with a third party, petitioner caused the subsidiary to adopt a plan of complete liquidation which was consummated 1 day later.
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Petitioner, whose principal business was the manufacture and sale of precision switches and thermostatic controls, acquired a subsidiary engaged in the manufacture of metal buttons for work clothing by acquiring all of its outstanding capital stock solely in exchange for shares of petitioner's own voting stock. Thereafter, pursuant to an agreement with a third party, petitioner caused the subsidiary to adopt a plan of complete liquidation which was consummated 1 day later. Petitioner received as a liquidating distribution certain accounts receivable, inventories, land, and depreciable assets…
1Opinion of the Court
Dawson, Judge:
Respondent determined deficiencies in petitioner’s income tax for the years 1953 and 1955 in the amounts of $26,531.96 and $212,794.49, respectively.
The parties have agreed that the sole issue for decision is whether the sale at a loss, of accounts receivable, inventories, land, and depre-ciable assets acquired by petitioner upon the distribution in complete liquidation of its wholly owned subsidiary, constitutes a capital loss or an ordinary loss for Federal income tax purposes. If the loss is a capital loss, it is allowable to petitioner only to the extent of capital gains,…
2Cases cited2 opinions
- Rollingwood Corp. v. Commissioner of Internal Revenue. Bohannon v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1951
- Advance Aluminum Castings Corp. v. HarrisonCourt of Appeals for the Seventh Circuit · 1946
3Cited by20 opinions
- Verito v. CommissionerUnited States Tax Court · 1965
- Hoover Co. v. CommissionerUnited States Tax Court · 1979
- The Acro Manufacturing Company v. Commissioner of Internal RevenueCourt of Appeals for the Sixth Circuit · 1964
- Glacier State Electric Supply Co. v. CommissionerUnited States Tax Court · 1983
- Kansas Sand & Concrete, Inc. v. CommissionerUnited States Tax Court · 1971
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