Reo Motors, Inc. v. Commissioner
United States Tax Court
In 1941 petitioner sustained a loss resulting from the worthlessness of a subsidiary's stock. Under section 23 (g) as constituted in 1941 such loss is a capital loss, but under section 23 (g) as constituted in 1942 such loss would be an ordinary loss.
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In 1941 petitioner sustained a loss resulting from the worthlessness of a subsidiary's stock. Under section 23 (g) as constituted in 1941 such loss is a capital loss, but under section 23 (g) as constituted in 1942 such loss would be an ordinary loss. Section 122 (d) (4), as applied to the instant case, has the effect of excluding petitioner's stock loss in computing the 1941 net operating loss for purposes of a net operating loss deduction in 1942 if such stock loss is a capital loss. Held, section 23 (g) as constituted in 1941, the year giving rise to the stock loss, controls and…
1Opinion of the Court
OPINION.
Hill, Judge:
The loss sustained by petitioner in 1941 by virtue of Reo Sales Corporation stock becoming worthless is a capital loss under section 23 (g) of the Internal Revenue Code as that section was constituted in 1941. However, under the provisions of section 23 (g)1 as that section was constituted in 1942, if the same loss had occurred in 1942 it would not have been a capital loss, but an ordinary loss. If the loss in question is a capital loss, then it must be excluded from a net operating loss computation by virtue of section 122 (d) (4) of the code.2 If, however, the loss in…
2Cases cited1 opinion
- Moore, Inc. v. CommissionerUnited States Tax Court · 1944
3Cited by7 opinions
- Reo Motors, Inc. v. CommissionerSupreme Court of the United States · 1950
- Cambria Collieries Co. v. CommissionerUnited States Tax Court · 1948
- Community Public Service Co. v. CommissionerUnited States Tax Court · 1949
- Blackhawk-Perry Corp. v. CommissionerUnited States Tax Court · 1948
- Cambria Collieries Co. v. CommissionerUnited States Tax Court · 1948
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