Barton Naphtha Co. v. Commissioner
United States Tax Court
Held, petitioners constituted a brother-sister controlled group of corporations within the meaning of sec. 1563(a)(2), I.R.C. 1954. Employees' stock in the employer corporation subject to a condition which extends to such corporation a right of first refusal is properly to be treated as "excluded stock" under sec. 1563(c)(2)(B) (ii). Such a condition constitutes a substantial restriction upon the employees' right of disposition.
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Held, petitioners constituted a brother-sister controlled group of corporations within the meaning of sec. 1563(a)(2), I.R.C. 1954. Employees' stock in the employer corporation subject to a condition which extends to such corporation a right of first refusal is properly to be treated as "excluded stock" under sec. 1563(c)(2)(B) (ii). Such a condition constitutes a substantial restriction upon the employees' right of disposition. The lack of tax-avoidance motives associated with the imposition of such a restriction is no impediment to the operation of the statute. Held, further, said…
1Opinion of the Court
Fay, Judge:
Respondent determined the following deficiencies in the income taxes of petitioners for the taxable years 1965 through 1967:
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The sole issue presented is whether petitioner corporations are entitled to multiple surtax exemptions during the taxable years in question.
FINDINGS OF FACT
Some of the facts have been stipulated. The stipulation of facts and exhibits attached thereto are incorporated herein by this reference.
Petitioner Barton Naphtha Co. (hereinafter referred to as Barton-Naphtha), doing business under the tradename of Barton Solvents, Inc., and petitioner Barton…
2Cases cited5 opinions
- Doss v. YinglingIndiana Court of Appeals · 1930
- Krauss v. KuechlerMassachusetts Supreme Judicial Court · 1938
- McDonald v. Farley & Loetscher Manufacturing Co.Supreme Court of Iowa · 1939
- Mason v. Mallard Telephone Co.Supreme Court of Iowa · 1932
- Elson v. Security State Bank of AllertonSupreme Court of Iowa · 1954
3Cited by12 opinions
- Superior Beverage Co. v. CommissionerUnited States Tax Court · 1972
- Mid-America Industries, Inc., a Delaware Corporation v. United StatesCourt of Appeals for the Eighth Circuit · 1973
- In Re Mushroom Transportation Co.United States Bankruptcy Court, E.D. Pennsylvania · 1988
- Mid-America Industries, Inc. v. United StatesDistrict Court, W.D. Arkansas · 1972
- Crow-Burlingame Co. v. CommissionerUnited States Tax Court · 1976
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