Raymond B. Mitchell and Beverly Mitchell v. Commissioner of Internal Revenue

HUFSTEDLER, Circuit Judge:

Appellants Raymond and Beverly Mitchell appeal from a decision of the Tax Court pursuant to Section 7482 of the Internal Revenue Code of 1954. The Tax Court held that the gain realized by appellants from the transfer of certain stock options constituted ordinary income; appellants contend that it was a capital gain. We affirm the Tax Court.

On September 21, 1961, Raymond Mitchell received a five-year option to purchase 2,353 shares of the common stock of his employer, the Western Rubber Corporation, at $22 per share. Western subsequently was consolidated into Amerco,…