Martin v. Commissioner
United States Tax Court
Petitioner's employer's business was liquidated by transfer of its assets to its sole stockholder. Concurrently with the transfer, petitioner became an employee of the transferee corporation. Thereafter the pension plan of the transferor-corporation was terminated and petitioner received a lump-sum payment for the rights he had in the fund at the time of his separation from the service of his employer.
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Petitioner's employer's business was liquidated by transfer of its assets to its sole stockholder. Concurrently with the transfer, petitioner became an employee of the transferee corporation. Thereafter the pension plan of the transferor-corporation was terminated and petitioner received a lump-sum payment for the rights he had in the fund at the time of his separation from the service of his employer. Held, following Mary Miller, 22 T. C. 293, affd. 226 F. 2d 618, that the lump-sum payment is taxable as long-term capital gain under section 165 (b), I. R. C. 1939.
1Opinion of the Court
OPINION.
Johnson, Judge:
The disagreement under the issue is whether the distribution was made “on account of the employee’s separation from the service” within the meaning of section 165 (b), Internal Revenue Code of 1939.1
Petitioner was a participating member of a tax-exempt pension plan of Dellinger. All of the corporation’s assets were transferred to Sperry, its sole stockholder, on April 1, 1949, in liquidation proceedings and the transferor was, in due course, dissolved. On that date all of the employees of Dellinger became employees of Sperry, and it carried on the business previously…
2Cases cited2 opinions
- Miller v. CommissionerUnited States Tax Court · 1954
- Glinske v. CommissionerUnited States Tax Court · 1951
3Cited by8 opinions
- United States v. Ben Martin and Rachel T. MartinCourt of Appeals for the Eighth Circuit · 1964
- Philip J. McGowan and Lorraine McGowan v. United StatesCourt of Appeals for the Seventh Circuit · 1960
- Nelson v. United StatesDistrict Court, D. Idaho · 1963
- Gegax v. CommissionerUnited States Tax Court · 1979
- Edwards v. CommissionerUnited States Tax Court · 1989
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