Mack v. Commissioner
United States Tax Court
Under the will of his father petitioner was given an option to purchase within a limited time certain shares of stock from the testamentary trustees at approximately one-half of their market value at the time of such purchase. Exercising the option, he purchased five of such shares from the trustees in November 1940, and in December of that year he sold them at a price considerably in excess of the amount which he paid to the trustees.
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Under the will of his father petitioner was given an option to purchase within a limited time certain shares of stock from the testamentary trustees at approximately one-half of their market value at the time of such purchase. Exercising the option, he purchased five of such shares from the trustees in November 1940, and in December of that year he sold them at a price considerably in excess of the amount which he paid to the trustees. Held, that the basis for the determination of the gain upon the sale is the amount which he paid to the testamentary trustees for them.
1Opinion of the Court
OPINION.
Smith, Judge-.
This proceeding involves a deficiency of $20.90 in petitioner’s income tax for 1940. The question for our determination is the proper basis to be used in determining the gain upon the sale in 1940 of shares of stock which the petitioner acquired under a testamentary option from the trustees under his father’s will.
The facts are found as stipulated. They are in substance as follows: The petitioner is a resident of McKeesport, Pennsylvania. He filed his income tax return for 1940 with the collector of internal revenue for the twenty-third district of Pennsylvania, at…
2Cases cited4 opinions
- Helvering v. San Joaquin Fruit & Investment Co.Supreme Court of the United States · 1936
- Estate of FlemingSupreme Court of Pennsylvania · 1898
- Dilworth's EstateSupreme Court of Pennsylvania · 1914
- Bayer v. WalshSupreme Court of Pennsylvania · 1895
3Cited by13 opinions
- Molbreak v. CommissionerUnited States Tax Court · 1973
- Delone v. CommissionerUnited States Tax Court · 1946
- John J. Kalbac and Dorothy Kalbac v. Commissioner of Internal Revenue, John G. Kiske and Clara Kiske v. Commissioner of Internal RevenueCourt of Appeals for the Eighth Circuit · 1962
- C. G. Sloan & Co. v. CommissionerUnited States Tax Court · 1962
- Valleskey v. NelsonDistrict Court, E.D. Wisconsin · 1958
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