Borden v. District of Columbia

MACK, Associate Judge:

Appellants/taxpayers dispute the District of Columbia’s determination that the sale of certain collateral held by a bank was a taxable event for them. The bank mistakenly sold appellants’ pledged securities and, upon discovery of the error, repurchased the stock. The trial court agreed with the District that the bank’s action constituted a sale and later repurchase of the stock by the taxpayers. 1 Appellants argue that the bank’s action constituted a tax free exchange of stock. 2 Although we disagree with the characterization of these transactions by both parties, we…