Barran v. Commissioner
United States Tax Court
Petitioners, equal partners in White Way Pure Milk Company, sold the assets of the partnership to Pet Dairy Products Company and entered into individual covenants not to compete for a period of 10 years.
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Petitioners, equal partners in White Way Pure Milk Company, sold the assets of the partnership to Pet Dairy Products Company and entered into individual covenants not to compete for a period of 10 years. Held, (1) that partnership assets were sold and not partnership interests; (2) that payments under the covenants not to compete were ordinary income and not capital gain from the sale of goodwill; (3) that the sales price of the partnership's inventory of milk and dairy products was $ 17,770.49 and not $ 10,000 as reported; and (4) that the sales price of the partnership's expendable supplies…
1Opinion of the Court
OPINION.
Turner, Judge:
The initial contention of the petitioners raises a question of fact, namely, whether they sold partnership interests to Pet or partnership assets. On brief, they concede that if they sold individual assets, they did not sell partnership interests. It is their position that they sold a going milk business, that such milk business was the only business owned by the partnership, and they therefore sold their partnership interests. They cite and rely on Hatch’s Estate v. Commissioner, 198 F. 2d 26, reversing 14 T.C. 251.
The facts do not support petitioners’ contention. The…
2Cases cited7 opinions
- Ullman v. CommissionerCourt of Appeals for the Second Circuit · 1959
- Schulz v. CommissionerCourt of Appeals for the Ninth Circuit · 1961
- Michaels v. CommissionerUnited States Tax Court · 1949
- Hatch's Estate v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1952
- John W. Rogers and Creta B. Rogers v. United StatesCourt of Appeals for the Ninth Circuit · 1961
2 more not listed; retrieve them via the Exa API.
3Cited by39 opinions
- Danielson v. CommissionerUnited States Tax Court · 1965
- Schmitz v. CommissionerUnited States Tax Court · 1968
- Foxman v. CommissionerUnited States Tax Court · 1964
- Lucas v. CommissionerUnited States Tax Court · 1972
- Reily v. CommissionerUnited States Tax Court · 1969
34 more not listed; retrieve them via the Exa API.