King v. Commissioner
United States Tax Court
Mason & Dixon, a motor carrier of freight, was the sole shareholder of Interstate, Motorways, and Regal. For 5 years prior to Oct. 4, 1963, the only income of the subsidiaries was derived from the rental of motor freight terminals to their parent on a net lease basis. Held: The distribution of the stock of Interstate, Motorways, and Regal to its shareholders (the petitioners) by Mason & Dixon on Oct. 4, 1963, constitutes a taxable dividend.
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Mason & Dixon, a motor carrier of freight, was the sole shareholder of Interstate, Motorways, and Regal. For 5 years prior to Oct. 4, 1963, the only income of the subsidiaries was derived from the rental of motor freight terminals to their parent on a net lease basis. Held: The distribution of the stock of Interstate, Motorways, and Regal to its shareholders (the petitioners) by Mason & Dixon on Oct. 4, 1963, constitutes a taxable dividend. The subsidiaries were not engaged in the active conduct of a trade or business during the 5-year period prior to the date of distribution. Sec. 355(b),…
1Opinion of the Court
StekRett, Judge:
The respondent determined deficiencies in the Federal income taxes of petitioners in these consolidated case for the year 1963 as follows:
Docket No. Deficiency
4084r-68_. $130, 945. 51
4085-68-168,462. 24
4086-68-17,455. 78
4087-68-17,455. 78
4088-68-8, 350. 46
4089-68-171, 652.81
4090-68-17, 455.84
Docket No. Deficiency
4091-68— $17,455. 84
4092-68_ 159, 859.98
4093-68_ 17,189. 59
4094^68_ 8, 350.46
4095-68— 2, 096. 59
4096-68_ 24,818.26
4097-68— 593. 30
The sole issue presented for our determination is whether the distribution of all of the stock of three of its wholly owned subsidiaries by…
2Cases cited21 opinions
- Hazard v. CommissionerUnited States Tax Court · 1946
- Lagreide v. CommissionerUnited States Tax Court · 1954
- Fackler v. Commissioner of Internal RevenueCourt of Appeals for the Sixth Circuit · 1943
- Coady v. CommissionerUnited States Tax Court · 1960
- Fackler v. CommissionerUnited States Board of Tax Appeals · 1941
16 more not listed; retrieve them via the Exa API.
3Cited by3 opinions
- E. Ward King and Myrtle C. King v. Commissioner of Internal RevenueCourt of Appeals for the Sixth Circuit · 1972
- E. Ward King and Myrtle C. King v. Commissioner of Internal RevenueCourt of Appeals for the Sixth Circuit · 1972
- King v. CommissionerUnited States Tax Court · 1971