Transylvania R. Co. v. Commissioner
United States Board of Tax Appeals
Where a corporation acquired its own bonds at a price less than the issuing price, the amount of the excess of issuing price over purchasing price constituted taxable gain or income.
1Opinion of the Court
*336OPINION.
Miller :
The petitioner in 1932 bought $19,000 par value of its outstanding bonds for $4,750. The respondent held that the difference of $14,250 was a taxable gain and determined a deficiency. This determination the petitioner assails on the theory, first, that it did not retire the bonds and, second, that the value of its entire assets in 1932 was less than the amount of outstanding bonds and that consequently no assets were freed by the purchase.
1. It is not necessary that reacquired bonds be retired in order that gain accrue from the purchase. This question has been decided by the…
2Cases cited3 opinions
- United States v. Kirby Lumber CoSupreme Court of the United States · 1931
- Bowers v. Kerbaugh-Empire Co.Supreme Court of the United States · 1926
- Helvering v. American Chicle Co.Supreme Court of the United States · 1934
3Cited by2 opinions
- Transylvania R. Co. v. Commissioner of Internal RevenueCourt of Appeals for the Fourth Circuit · 1938
- Transylvania R. Co. v. CommissionerUnited States Board of Tax Appeals · 1937