Morgan v. Commissioner
United States Tax Court
1. Held, an exchange of the type specified in paragraph (1) of section 112(c), I.R.C. 1939, is a prerequisite to the application of paragraph (2) thereof; held, further, the distributions in liquidation of petitioner-husband's wholly owned corporation are not taxable as dividends under section 112(c)(2), 1939 Code, but are taxable to the extent the distributions exceed the cost basis of petitioner's stock as long-term capital gain. 2. Held, section 45 of the 1939 Code does…
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1. Held, an exchange of the type specified in paragraph (1) of section 112(c), I.R.C. 1939, is a prerequisite to the application of paragraph (2) thereof; held, further, the distributions in liquidation of petitioner-husband's wholly owned corporation are not taxable as dividends under section 112(c)(2), 1939 Code, but are taxable to the extent the distributions exceed the cost basis of petitioner's stock as long-term capital gain. 2. Held, section 45 of the 1939 Code does not authorize respondent to treat distributions in complete liquidation of one corporation of which petitioners held…
1Opinion of the Court
OPINION.
Black, Judge:
There is no dispute between the parties as to the amounts of gain which petitioners received from the liquidation of their shares in Wellington Corporation and in Fund Shares, Inc. The dispute is as to how such gains should be treated for taxation.
Issue 1. Wellington Corporation.
The first issue presented is whether the distributions by the Corporation to petitioner in the amount of $214,150.99 were in liquidation of stock or had the effect of taxable dividends to the extent of petitioner’s gain on the distribution. Petitioner contends that that portion of the payment in…
2Cases cited11 opinions
- Gould v. GouldSupreme Court of the United States · 1917
- Commissioner of Internal Revenue v. Chelsea Products, IncCourt of Appeals for the Third Circuit · 1952
- Lewis v. Commissioner of Internal RevenueCourt of Appeals for the First Circuit · 1949
- Survaunt v. Commissioner of Internal RevenueCourt of Appeals for the Eighth Circuit · 1947
- William Liddon v. Commissioner of Internal Revenue, Maria Prothro Liddon v. Commissioner of Internal RevenueCourt of Appeals for the Sixth Circuit · 1956
6 more not listed; retrieve them via the Exa API.
3Cited by23 opinions
- South Texas Rice Warehouse Co. v. CommissionerUnited States Tax Court · 1965
- James Armour, Inc. v. CommissionerUnited States Tax Court · 1964
- Moffatt v. CommissionerUnited States Tax Court · 1964
- Abegg v. CommissionerUnited States Tax Court · 1968
- Grubbs v. CommissionerUnited States Tax Court · 1962
18 more not listed; retrieve them via the Exa API.