Redwing Carriers, Inc. v. Tomlinson

GOLDBERG, Circuit Judge:

This case involves another attempt by a taxpayer to insulate himself from the incidence of taxation by means of paper armor. The question presented is whether a taxpayer may shape what is essentially an integrated purchase and trade-in transaction of new and used trucks into two separate transactions in order to recognize an immediate gain at capital gains rates and concomitantly to take a larger depreciation deduction from ordinary income. We agree with the district court that this transaction is an exchange rather than two sales, and thus comes within the coverage of…