W. G. Maguire & Co. v. Commissioner
United States Tax Court
1. Mokan Corporation acquired Panhandle Eastern stock at a cost of $ 47.86 per share. During 1944, Mokan issued to its stockholders rights to buy Panhandle Eastern stock at $ 30 per share, and on the date the rights were issued the fair market value of each share was $ 40. During the period the rights were being exercised the value of the shares increased. Stockholders of Mokan, among whom were the petitioners, purchased 151,958 shares of the stock.
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1. Mokan Corporation acquired Panhandle Eastern stock at a cost of $ 47.86 per share. During 1944, Mokan issued to its stockholders rights to buy Panhandle Eastern stock at $ 30 per share, and on the date the rights were issued the fair market value of each share was $ 40. During the period the rights were being exercised the value of the shares increased. Stockholders of Mokan, among whom were the petitioners, purchased 151,958 shares of the stock. In computing Mokan's "earnings or profits" for the year 1944, the Commissioner would allow no deduction from net income based on the sale of the…
1Opinion of the Court
OPINION.
Black, Judge:
The three petitioners have in common the fact that during the taxable year 1944, they were three of the many stockholders of Mokan corporation.
The principal issue here relates to the distributions made by Mokan to its stockholders during the taxable year. Mokan distributed an aggregate of $878,584.80 in cash, and, in addition, rights entitling its stockholders to purchase Panhandle Eastern Pipe Line Company shares at $30 per share. Of the 163,710 shares offered to stockholders, Mokan sold through the exercise of rights a total of 151,958 shares. Respondent determined that…
2Cases cited10 opinions
- Palmer v. CommissionerSupreme Court of the United States · 1937
- R. D. Merrill Co. v. CommissionerUnited States Tax Court · 1945
- Young v. CommissionerUnited States Tax Court · 1945
- Stone v. ComissionerUnited States Tax Court · 1953
- Godley v. CommissionerUnited States Tax Court · 1953
5 more not listed; retrieve them via the Exa API.
3Cited by3 opinions
- Gerald R. Redding and Dorothy M. Redding and Thomas W. Moses and Anne M. Moses v. Commissioner of Internal RevenueCourt of Appeals for the Seventh Circuit · 1980
- Gerald R. Redding and Dorothy M. Redding and Thomas W. Moses and Anne M. Moses v. Commissioner of Internal RevenueCourt of Appeals for the Seventh Circuit · 1980
- W. G. Maguire & Co. v. CommissionerUnited States Tax Court · 1953