Legal Opinion

Long Island Water Corp. v. Commissioner

United States Tax Court

Decided May 25, 1961No. Docket No. 65960Published

1. A, a public utility holding company, and M, an investment banking firm, agreed that M should acquire all of the capital stock of Q, an operating water company, and transfer it to petitioner, a newly organized corporation, in exchange for petitioner's stock and bonds. When these transactions were completed Q was merged into petitioner. M then exchanged the stock it held in petitioner for an agreed number of A's shares which were subsequently sold on the open market.

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1. A, a public utility holding company, and M, an investment banking firm, agreed that M should acquire all of the capital stock of Q, an operating water company, and transfer it to petitioner, a newly organized corporation, in exchange for petitioner's stock and bonds. When these transactions were completed Q was merged into petitioner. M then exchanged the stock it held in petitioner for an agreed number of A's shares which were subsequently sold on the open market. Prior to these steps taking place the stockholders of Q were in control of its assets. Afterwards A owned all of petitioner's…

1Opinion of the Court

Long Island Water Corporation, Petitioner, v. Commissioner of Internal Revenue, Respondent

Long Island Water Corp. v. Commissioner

Docket No. 65960

United States Tax Court

36 T.C. 377; 1961 U.S. Tax Ct. LEXIS 141;

May 25, 1961, Filed

Decision will be entered under Rule 50.

1. A, a public utility holding company, and M, an investment banking firm, agreed that M should acquire all of the capital stock of Q, an operating water company, and transfer it to petitioner, a newly organized corporation, in exchange for petitioner's stock and bonds. When these transactions were completed Q was merged into…

2Cases cited19 opinions

  1. Kimbell-Diamond Milling Co. v. Comm'rUnited States Tax Court · 1950
  2. Kimbell-Diamond Milling Co. v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1951
  3. American Bantam Car Co. v. CommissionerUnited States Tax Court · 1948
  4. Commissioner of Internal Revenue v. Ashland Oil & Refining Co.Court of Appeals for the Sixth Circuit · 1938
  5. Koppers Coal Co. v. CommissionerUnited States Tax Court · 1946

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