Atlantic Properties, Inc. v. Commissioner
United States Tax Court
Petitioner was engaged in leasing business properties which were old and rundown. The president of petitioner, who owned 25 percent of its outstanding stock, desired to accumulate earnings to refurbish the structures although his plans and estimates for doing so were vague and indefinite. The other four shareholders who collectively owned 75 percent of the outstanding stock wanted petitioner to pay dividends.
Read the full summary
Petitioner was engaged in leasing business properties which were old and rundown. The president of petitioner, who owned 25 percent of its outstanding stock, desired to accumulate earnings to refurbish the structures although his plans and estimates for doing so were vague and indefinite. The other four shareholders who collectively owned 75 percent of the outstanding stock wanted petitioner to pay dividends. The articles of organization and bylaws of petitioner required an 80-percent vote of the shareholders to approve payment of dividends, performance of needed repairs, and improvements or…
1Opinion of the Court
Goffe, Judge:
The Commissioner determined deficiencies in Federal income tax of petitioner as follows:
ra Nov. so— Deficiency TYD Nov. SO — • Deficiency
1965_ $3, 318. 89 1967 _ $8, 526.26
1966_ 8, 233.46 1968_ 7,740.40
The sole issue is whether petitioner, during the taxable years m question, was formed or availed of for the purpose of avoiding the income tax with respect to its shareholders by permitting earnings and profits to accumulate instead of being divided and distributed and is, therefore, subject to the accumulated earnings tax imposed under section 531 of the Internal Revenue Code of…
2Cases cited23 opinions
- Helvering v. National Grocery Co.Supreme Court of the United States · 1938
- United States v. Donruss Co.Supreme Court of the United States · 1969
- The Smoot Sand & Gravel Corporation v. Commissioner of Internal RevenueCourt of Appeals for the Fourth Circuit · 1960
- Dixie, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1960
- Faber Cement Block Co. v. CommissionerUnited States Tax Court · 1968
18 more not listed; retrieve them via the Exa API.
3Cited by25 opinions
- Smith v. Atlantic Properties, Inc.Massachusetts Appeals Court · 1981
- Atlantic Properties, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the First Circuit · 1975
- Hughes, Inc. v. CommissionerUnited States Tax Court · 1988
- Snow Mfg. Co. v. CommissionerUnited States Tax Court · 1986
- Proctor v. CommissionerUnited States Tax Court · 1981
20 more not listed; retrieve them via the Exa API.