Terhune v. Commissioner
United States Board of Tax Appeals
1. Pursuant to a plan of recapitalization, petitioners' preferred stock in the Berkeley Woolen Co. was exchanged for cash and debentures. As an essential part of the exchange, the stock, when received, was canceled and retired.
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1. Pursuant to a plan of recapitalization, petitioners' preferred stock in the Berkeley Woolen Co. was exchanged for cash and debentures. As an essential part of the exchange, the stock, when received, was canceled and retired. Held, the total gain realized by each petitioner under section 111 of the Revenue Act of 1934 and recognized under section 112 is to be taken into account in computing net income, since the receipt of cash and debentures constituted a distribution in partial liquidation under section 115. 2. The stock of one of the petitioners in the McKown Orchard Co. became worthless…
1Opinion of the Court
*751OPINION.
Leech :
Nine deficiencies in income tax for the calendar year 1934 are here in dispute. The proceedings were consolidated. The deficiencies, determined by the respondent, are as follows:
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The proceedings were submitted on separate stipulations of fact. The facts are found as stipulated. The first issue, common to all of the petitioners, is whether gains accruing to the petitioners upon the exchange of their preferred stock in the Berkeley Woolen Co., a West Virginia corporation, for cash and debenture bonds, pursuant to apian of recapitalization, are taxable as…
2Cases cited3 opinions
- Pinellas Ice & Cold Storage Co. v. CommissionerSupreme Court of the United States · 1933
- White v. United StatesSupreme Court of the United States · 1938
- Helvering v. Chester N. Weaver Co.Supreme Court of the United States · 1938
3Cited by3 opinions
- GE Employees Securities Corporation v. ManningCourt of Appeals for the Third Circuit · 1943
- Childs v. CommissionerUnited States Board of Tax Appeals · 1941
- Terhune v. CommissionerUnited States Board of Tax Appeals · 1939