58th Street Plaza Threatre, Inc. v. Commissioner
United States Tax Court
1. Deductions -- Depreciation -- Amortization of Leasehold. -- The transaction in which the taxpayer purchased a leasehold from its principal stockholder was bona fide so that thereafter the taxpayer was entitled to deductions for depreciation of the leasehold. 2. Income -- Capital Gain -- Sale of Leasehold. -- The taxpayer made a bona fide sale of a leasehold to a corporation of which he was the principal stockholder and the purchase price as received by him represented…
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1. Deductions -- Depreciation -- Amortization of Leasehold. -- The transaction in which the taxpayer purchased a leasehold from its principal stockholder was bona fide so that thereafter the taxpayer was entitled to deductions for depreciation of the leasehold. 2. Income -- Capital Gain -- Sale of Leasehold. -- The taxpayer made a bona fide sale of a leasehold to a corporation of which he was the principal stockholder and the purchase price as received by him represented long term capital gains rather than dividends from the corporation. 3. Income -- Family Owned Corporation. -- The sublease…
1Opinion of the Court
OPINION.
Murdock, Judge:
The first two issues can be considered together. The Commissioner argues that the lease from Reade to Brecher had no value on February 28, 1942, but the evidence shows that it was ■worth at least $200,000 at that time. The other contention of the Commissioner is that Plaza was already the beneficial owner of the lease, and, as Brecher controlled Plaza, the transaction whereby Brecher sold the lease to Plaza was lacking in substance and bona fides. It is appropriate to scrutinize the various transactions closely since the stock of Plaza at the time was held by Brecher…
2Cases cited3 opinions
- Gregory v. HelveringSupreme Court of the United States · 1935
- Higgins v. SmithSupreme Court of the United States · 1940
- Moline Properties, Inc. v. CommissionerSupreme Court of the United States · 1943
3Cited by25 opinions
- Federbush v. CommissionerUnited States Tax Court · 1960
- United States v. 58th Street Plaza Theatre, Inc.District Court, S.D. New York · 1968
- Hagaman v. CommissionerUnited States Tax Court · 1987
- Kenneth A. Murry and Helen J. Murry v. Commissioner of Internal Revenue, Lakeside Garden Developers, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1979
- Nickerson Lumber Company v. United StatesDistrict Court, D. Massachusetts · 1963
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