Commissioner of Corporations & Taxation v. Fopiano

These are two appeals by the commissioner of corporations and taxation from decisions of the Appel*305late Tax Board granting abatements of income taxes assessed upon the amounts by which certain dividends paid to the two taxpayers exceeded the cost of their stock. These dividends were paid out of current earnings at a time when the capital was impaired to an extent greater than the amount of all the dividends then paid by the corporation. The commissioner, while conceding that the payments of the dividends to the taxpayers were distributions of capital and consequently not taxable under G. L.…