Johnson v. Commissioner
United States Tax Court
Held: The fair market value of Mattel stock was the mean price at which the stock was sold on the New York Stock Exchange on the dates stock options were exercised by Ps. Misstatements of the corporation's financial condition by its officers, and the officers' subsequent indictment and pleas of nolo contendere, do not warrant using a fair market value different from the mean price of the stock. Horwith v. Commissioner, 71 T.C. 932 (1979), followed.
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Held: The fair market value of Mattel stock was the mean price at which the stock was sold on the New York Stock Exchange on the dates stock options were exercised by Ps. Misstatements of the corporation's financial condition by its officers, and the officers' subsequent indictment and pleas of nolo contendere, do not warrant using a fair market value different from the mean price of the stock. Horwith v. Commissioner, 71 T.C. 932 (1979), followed. Held, further, Ps are liable for the addition to tax under sec. 6653(a), I.R.C. 1954, for their negligent failure to report the income from the…
1Opinion of the Court
Simpson, Judge:
The Commissioner determined a deficiency of $199,578 in the petitioners’ Federal income tax for 1971 and an addition to the tax of $9,979 under section 6653(a), I.R.C. 1954.1 The parties have settled certain issues, and the issues remaining for decision are: (1) Whether for purposes of determining the income from the exercise of employee stock options, the fair market value of the stock so acquired is to be based on its prices on the New York Stock Exchange even though it was later learned that the corporate officers had misrepresented the corporation’s earnings; and (2)…
2Cases cited16 opinions
- Bixby v. CommissionerUnited States Tax Court · 1972
- United States v. CartwrightSupreme Court of the United States · 1973
- Marie H. Hamm v. Commissioner of Internal Revenue, William Hamm, Jr. v. Commissioner of Internal RevenueCourt of Appeals for the Eighth Circuit · 1963
- Pritchett v. CommissionerUnited States Tax Court · 1974
- Rosano v. CommissionerUnited States Tax Court · 1966
11 more not listed; retrieve them via the Exa API.
3Cited by17 opinions
- George E. Johnson and Sylvia v. Johnson v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1982
- Gudmundsson v. United StatesDistrict Court, W.D. New York · 2009
- Rosenthal Chiropractic Offices, Inc. v. CommissionerUnited States Tax Court · 1993
- V-1 Oil Co. v. United StatesDistrict Court, D. Idaho · 1995
- Carter v. United StatesDistrict Court, N.D. Alabama · 2019
12 more not listed; retrieve them via the Exa API.