Buena Vista Farms, Inc. v. Commissioner
United States Tax Court
Held: B, a corporate farmer, held water primarily for sale in the ordinary course of its trade or business. Accordingly, the sale of 10 percent of its contractual right to receive payment in kind for water sold does not qualify as a sale or exchange of a capital asset under sec. 1221, I.R.C. 1954, and the gain attributable thereto is taxable as ordinary income.
1Opinion of the Court
Fay, Judge:
Respondent determined a deficiency in petitioner’s Federal income tax for the calendar year 1971 in the amount of $18,951.
Due to concessions, the sole issue remaining is whether the gain realized by petitioner on the sale of a portion of its contractual right to receive certain water was capital gain or ordinary income.
FINDINGS OF FACT
Certain facts were stipulated and are so found.
Petitioner Buena Vista Farms, Inc., was incorporated in the State of Delaware in 1965. At the time of filing the petition herein, its principal place of business was located in San Francisco, Calif.…
2Cases cited17 opinions
- Corn Products Refining Co. v. CommissionerSupreme Court of the United States · 1956
- Commissioner v. P. G. Lake, Inc.Supreme Court of the United States · 1958
- Hort v. CommissionerSupreme Court of the United States · 1941
- Arrowsmith v. CommissionerSupreme Court of the United States · 1952
- Commissioner v. Gillette Motor Transport, Inc.Supreme Court of the United States · 1960
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3Cited by6 opinions
- Wachner v. CommissionerUnited States Tax Court · 1995
- Foote v. CommissionerUnited States Tax Court · 1983
- Buena Vista Farms, Inc. v. CommissionerUnited States Tax Court · 1977
- Denison v. CommissionerUnited States Tax Court · 1977
- Foote v. CommissionerUnited States Tax Court · 1983
1 more not listed; retrieve them via the Exa API.