Litton Business Systems, Inc. v. Commissioner
United States Tax Court
P corporation entered into an agreement with unrelated T corporation (an established financially successful business), whereby P, or a wholly owned subsidiary, would acquire all of the assets of T in exchange for voting common stock of P, pursuant to sec. 368(a)(1) (C), I.R.C. 1954. In order to effect the reorganization agreement, P incorporated a wholly owned subsidiary, S corporation.
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P corporation entered into an agreement with unrelated T corporation (an established financially successful business), whereby P, or a wholly owned subsidiary, would acquire all of the assets of T in exchange for voting common stock of P, pursuant to sec. 368(a)(1) (C), I.R.C. 1954. In order to effect the reorganization agreement, P incorporated a wholly owned subsidiary, S corporation. P stock, valued at $ 28,542,802.50, was then made available by P to S pursuant to a contribution to capital by P to S of $ 9,227,385.19 of P stock and by a sale of the remaining $ 19,315,417.31 of P stock by P…
1Opinion of the Court
Dawson, Judge:*
In his statutory notice of deficiency respondent determined the following deficiencies in the Federal income taxes of Eureka-Carlisle Co. (formerly Eureka Specialty Printing Co.), which was later acquired by petitioner pursuant to a statutory merger:
TYB July SI— Amount
1962___$429,625.36
1963_ 307,903. 49
1964_ 273, 412. 54
Certain concessions have been made by the parties. The only issuo remaining for our decision is whether part of a transfer by a parent corporation of its stock to a wholly owned subsidiary, for the purpose of having the subsidiary participate in a reorganization…
2Cases cited22 opinions
- John Kelley Co. v. CommissionerSupreme Court of the United States · 1946
- Fin Hay Realty Co. v. United StatesCourt of Appeals for the Third Circuit · 1968
- Gooding Amusement Co. v. CommissionerUnited States Tax Court · 1954
- John v. Rowan v. United StatesCourt of Appeals for the Fifth Circuit · 1955
- O. H. Kruse Grain & Milling v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1960
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3Cited by92 opinions
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- Jonathan B. Geftman v. Commissioner of Internal RevenueCourt of Appeals for the Third Circuit · 1998
- Gilbert v. CommissionerUnited States Tax Court · 1980
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