Kansas Sand & Concrete, Inc. v. Commissioner
United States Tax Court
In September 1964 petitioner purchased all of the stock of another corporation, S. Pursuant to an agreement between petitioner and S and in substantial accordance with Kansas corporation law, S was merged into petitioner in December 1964. Held, petitioner's basis in the assets it acquired from S as a result of the December transaction must be measured by reference to the September stock purchase price and not by reference to S's basis in those assets.
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In September 1964 petitioner purchased all of the stock of another corporation, S. Pursuant to an agreement between petitioner and S and in substantial accordance with Kansas corporation law, S was merged into petitioner in December 1964. Held, petitioner's basis in the assets it acquired from S as a result of the December transaction must be measured by reference to the September stock purchase price and not by reference to S's basis in those assets. Sec. 334(b)(2), I.R.C. 1954.
1Opinion of the Court
OPINION
FORRESTER, Judge:
In docket No. 3833-69, respondent has determined deficiencies in petitioner’s income taxes of $10,111.21 and $12,162.28 for the taxable years ending in 1965 and 1966, respectively. In docket No. 185-1-69 respondent has determined that petitioner is liable as transferee of the assets of Kansas Sand Co., Inc. (hereinafter referred to as Sand), for an income tax deficiency of $2,015.38 for the taxable year ending in 1964. The parties agree that in docket No. 1851-69 petitioner is liable as transferee for any income tax deficiency that may be dne from Sand for the taxable…
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