Franklin v. Commissioner
United States Board of Tax Appeals
1. The petitioner, under his agreement of employment, was granted in 1927 an option to purchase 20,000 shares of stock of corporation A, his employer company, and was also granted, as an inducement to enter into such employment agreement, an option to purchase 20,000 shares of stock of corporation B, which controlled corporation A, in the event corporation A did not make available to petitioner 20,000 shares of its stock as provided in the employment agreement.
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1. The petitioner, under his agreement of employment, was granted in 1927 an option to purchase 20,000 shares of stock of corporation A, his employer company, and was also granted, as an inducement to enter into such employment agreement, an option to purchase 20,000 shares of stock of corporation B, which controlled corporation A, in the event corporation A did not make available to petitioner 20,000 shares of its stock as provided in the employment agreement. In January 1928 the petitioner, through his New York attorneys, caused to be organized corporation C and corporation D and assigned…
1Opinion of the Court
*934OPINION.
McMahon:
The first question to consider is whether the transactions relating to the acquisition and disposition of the Wesco stock accomplished the purpose intended of avoiding or reducing taxes on the purchase and sale of 20,000 shares of Wesco stock.
The petitioner had an option to purchase Wesco stock. He organized two corporations. To one of them he assigned such option in exchange for its common stock and with funds paid by the petitioner for some of its preferred stock such company purchased the Wesco stock under the option. The petitioner turned over the common stock of the first…
2Cases cited4 opinions
- Gregory v. HelveringSupreme Court of the United States · 1935
- United States v. IshamSupreme Court of the United States · 1873
- Bullen v. WisconsinSupreme Court of the United States · 1916
- Bullen v. State of WisconsinSupreme Court of the United States · 1918
3Cited by21 opinions
- Soares v. CommissionerUnited States Tax Court · 1968
- Bell v. CommissionerUnited States Tax Court · 1957
- Corbett v. CommissionerUnited States Tax Court · 1963
- Herberger v. CommissionerUnited States Tax Court · 1950
- Abraham v. CommissionerUnited States Tax Court · 1962
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