Legal Opinion

Bell v. Commissioner

United States Tax Court

Decided November 16, 1982No. Docket Nos. 4979-76, 5007-76, 5010-76, 5019-76Unpublished

Three physicians formed a professional corporation (NA).They then formed a subchapter S corporation (S) to provide X-ray services for NA. They gave the stock in S to designated relatives (father of one physician, children of the other two physicians). Held: (1) S is recognized for tax purposes as a separate corporation. (2) S earned income from providing X-ray services to NA.

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Three physicians formed a professional corporation (NA).They then formed a subchapter S corporation (S) to provide X-ray services for NA. They gave the stock in S to designated relatives (father of one physician, children of the other two physicians). Held: (1) S is recognized for tax purposes as a separate corporation. (2) S earned income from providing X-ray services to NA. (3) Respondent's allocation of income between NA and S under sec. 482, I.R.C. 1954, is upheld in part. (4) Income thus allocated is treated as dividends from NA to the physicians, as NA's shareholders. (5) The physicians…

1Opinion of the Court

WILLIAM H. BELL, III, AND MARGARET A. BELL, ET AL., 1 Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent

Bell v. Commissioner

Docket Nos. 4979-76, 5007-76, 5010-76, 5019-76.

United States Tax Court

T.C. Memo 1982-660; 1982 Tax Ct. Memo LEXIS 85; 45 T.C.M. (CCH) 97; T.C.M. (RIA) 82660;

November 16, 1982.

Three physicians formed a professional corporation (NA).They then formed a subchapter S corporation (S) to provide X-ray services for NA. They gave the stock in S to designated relatives (father of one physician, children of the other two physicians).

Held: (1) S is recognized for tax…

2Cases cited28 opinions

  1. Welch v. HelveringSupreme Court of the United States · 1933
  2. Lucas v. EarlSupreme Court of the United States · 1930
  3. Helvering v. HorstSupreme Court of the United States · 1940
  4. Helvering v. TaylorSupreme Court of the United States · 1935
  5. Moline Properties, Inc. v. CommissionerSupreme Court of the United States · 1943

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