Gino A. Speca and Vera Speca v. Commissioner of Internal Revenue, Joseph F. Madrigrano and Shirley M. Madrigrano v. Commissioner of Internal Revenue

NOLAND, District Judge.

This is an appeal from a finding by the Tax Court of a deficiency in income taxes by appellants Gino A. Speca and Joseph F. Madrigrano for the year 1971. 1 The sole issue for review is whether the Tax Court erred in holding that certain transfers of stock by appellants to their children lacked sufficient economic reality to permit income from the stock to be taxed to the transferee-children rather than the transferorparents. A review of the record reveals the following undisputed facts.

Appellants are executives of Triangle Wholesale Company, Inc. (Triangle), a beer…