Van Products, Inc. v. Commissioner
United States Tax Court
Held, loan by a profit-sharing trust to the employer, creator of the trust, in exchange for an unsecured 1-year promissory note of the employer was without "adequate security" and therefore constituted a "prohibited transaction" within section 503(c)(1), I.R.C. 1954; consequently, section 503(a)(1) requires that the trust be denied exemption under section 501(a).
1Opinion of the Court
OPINION
Ratjm, Judge:
The Commissioner determined deficiencies in petitioner’s income tax for its taxable years ending March 31, 1959 and 1960, in the amounts of $2,304.29 and $2,496, respectively. The deficiencies were based upon the disallowance of claimed deductions in the amount of $4,800 for each of those years in respect of contributions to a profit-sharing trust. The facts have been stipulated.
Petitioner, an Ohio corporation organized in 1957, filed its returns for the years in controversy with the district director at Cincinnati.
On March 29, 1958, petitioner entered into a trust…
2Cases cited14 opinions
- Commissioner v. South Texas Lumber Co.Supreme Court of the United States · 1948
- Brewster v. GageSupreme Court of the United States · 1930
- Fawcus MacHine Co. v. United StatesSupreme Court of the United States · 1931
- Boske v. ComingoreSupreme Court of the United States · 1900
- Textile Mills Securities Corp. v. CommissionerSupreme Court of the United States · 1941
9 more not listed; retrieve them via the Exa API.
3Cited by18 opinions
- Foxman v. CommissionerUnited States Tax Court · 1964
- Pleasanton Gravel Co. v. CommissionerUnited States Tax Court · 1975
- Buehner v. CommissionerUnited States Tax Court · 1976
- De Marco v. CommissionerUnited States Tax Court · 1986
- Levy v. CommissionerUnited States Tax Court · 1966
13 more not listed; retrieve them via the Exa API.