Clark v. Commissioner
United States Tax Court
BASIN was merged into NL, a publicly held company, under a plan of reorganization which satisfied the requirements of sec. 368(a)(1)(A) and (a)( 2)(D), I.R.C. 1954. Petitioner husband as sole shareholder of BASIN received stock and cash in exchange for his stock in BASIN.
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BASIN was merged into NL, a publicly held company, under a plan of reorganization which satisfied the requirements of sec. 368(a)(1)(A) and (a)( 2)(D), I.R.C. 1954. Petitioner husband as sole shareholder of BASIN received stock and cash in exchange for his stock in BASIN. The cash constituted "boot" under sec. 356(a)(1), I.R.C. 1954. Held: The distribution of the "boot" did not have the effect of a dividend under sec. 356(a)(2), I.R.C. 1954. The test of Wright v. United States, 482 F.2d 600 (8th Cir. 1973), rather than the test of Shimberg v. United States, 577 F.2d 283 (5th Cir. 1978),…
1Opinion of the Court
TANNENWALD, Judge:
Respondent determined a deficiency in petitioners’ Federal income taxes for the taxable year 1979 of $972,504.74. The sole issue for decision is whether the receipt by petitioners of cash (boot) as partial consideration under a plan of reorganization pursuant to sec. 368(a)(1)(A) and (a)(2)(D),1 should be treated as a dividend pursuant to sec. 356(a)(2), instead of long-term capital gain under sec. 356(a)(1).
FINDINGS OF FACT
Some of the facts have been stipulated and are so found. This reference incorporates the stipulation of facts and attached exhibits.
Petitioners, husband…
2Cases cited21 opinions
- United States v. DavisSupreme Court of the United States · 1970
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- J. E. Davant and Kathryn Davant v. Commissioner of Internal Revenue, Commissioner of Internal Revenue v. J. E. Davant and Kathryn DavantCourt of Appeals for the Fifth Circuit · 1966
- King Enterprises, Inc. v. The United StatesUnited States Court of Claims · 1969
- South Texas Rice Warehouse Co. v. CommissionerUnited States Tax Court · 1965
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