Holsey v. Commissioner
United States Tax Court
Petitioner was a 50 per cent stockholder in a corporation and held an option to purchase the remaining stock. He assigned the option to the corporation and on the same date, the corporation purchased the stock for $ 80,000 which resulted in petitioner's becoming the sole stockholder in the corporation.
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Petitioner was a 50 per cent stockholder in a corporation and held an option to purchase the remaining stock. He assigned the option to the corporation and on the same date, the corporation purchased the stock for $ 80,000 which resulted in petitioner's becoming the sole stockholder in the corporation. Held, this was a distribution of earnings by the corporation which was essentially equivalent to the constructive distribution to the petitioner of a taxable dividend under section 115 (g), I. R. C. 1939.
1Opinion of the Court
Mulroney, Judge:
The respondent determined a deficiency in income tax of petitioners in the amount of $41,385.34 for the taxable year 1951.
The sole issue for our determination is whether the payment of $80,000 by J. R. Holsey Sales Co. to a 50 per cent corporate stockholder in redemption of that stock constitutes a constructive taxable dividend to Joseph R. Holsey, the remaining stockholder, within the purview of section 115 (g), Internal Revenue Code of 1939.
FINDINGS OF FACT.
Most of the facts have been stipulated and are found accordingly.
Joseph R. Holsey and Eleanor T. Holsey are husband and…
2Cases cited12 opinions
- Wall v. United StatesCourt of Appeals for the Fourth Circuit · 1947
- Flanagan v. HelveringCourt of Appeals for the D.C. Circuit · 1940
- Towers v. CommissionerUnited States Tax Court · 1955
- Boyle v. Commissioner of Internal RevenueCourt of Appeals for the Third Circuit · 1951
- McGuire v. Commissioner of Internal RevenueCourt of Appeals for the Seventh Circuit · 1936
7 more not listed; retrieve them via the Exa API.
3Cited by26 opinions
- Enoch v. CommissionerUnited States Tax Court · 1972
- Joseph R. Holsey and Eleanor T. Holsey v. Commissioner of Internal RevenueCourt of Appeals for the Third Circuit · 1958
- Decker v. CommissionerUnited States Tax Court · 1959
- Television Industries, Inc. v. CommissionerUnited States Tax Court · 1959
- Priester v. CommissionerUnited States Tax Court · 1962
21 more not listed; retrieve them via the Exa API.