James v. Commissioner
United States Tax Court
Chicora Apartments, Inc., was formed to construct and operate an apartment project. In return for obtaining the financing for the project and an FHA commitment to insure such financing, James received 50 percent of Chicora's stock. The Talbots received the other 50 percent of the stock in return for their transfer to Chicora of appreciated land on which the apartment project was to be constructed.
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Chicora Apartments, Inc., was formed to construct and operate an apartment project. In return for obtaining the financing for the project and an FHA commitment to insure such financing, James received 50 percent of Chicora's stock. The Talbots received the other 50 percent of the stock in return for their transfer to Chicora of appreciated land on which the apartment project was to be constructed. Held: 1. The stock received by James was issued for services and not in exchange for property; the fair market value of the stock is taxable to James as ordinary income. 2. Since James received his…
1Opinion of the Court
Simpson, Judge:
The respondent determined deficiencies in income tax and additions to tax for the year 1963 as follows:
Addition sec. 6663(a), DocketNo. • Petitioners Deficiency I.R.C. 1954
3165-67 William A. James and Beryl N. James_$12, 400. 69 $620. 04
5153-67 C.N. Talbot and Lula E. Talbot_ 1, 811. 82_
The issue for decision is whether the transaction by which Mr. James and Mr. Talbot acquired stock in a corporation was taxable or whether such transaction was tax free under section 351 of the Internal Revenue Code of 1954.1 The answer to the question thus posed with respect to each person…
2Cases cited10 opinions
- Ruge v. Comm'rUnited States Tax Court · 1956
- Blum v. Commissioner of Internal RevenueCourt of Appeals for the Third Circuit · 1950
- United States v. William D. Frazell and Martha T. FrazellCourt of Appeals for the Fifth Circuit · 1964
- Hamrick v. CommissionerUnited States Tax Court · 1964
- Lanova Corp. v. Comm'rUnited States Tax Court · 1952
5 more not listed; retrieve them via the Exa API.
3Cited by13 opinions
- D. N. Stafford and Flora C. Stafford v. United StatesCourt of Appeals for the Fifth Circuit · 1980
- United States v. D.N. Stafford and Flora C. StaffordCourt of Appeals for the Eleventh Circuit · 1984
- Intermountain Lumber Co. & Subsidiaries, etc. v. CommissionerUnited States Tax Court · 1976
- Mark IV Pictures, Inc. v. CommissionerUnited States Tax Court · 1990
- McCormack v. CommissionerUnited States Tax Court · 1987
8 more not listed; retrieve them via the Exa API.