Fredericks v. Commissioner
United States Board of Tax Appeals
A corporation having first and second preferred stock and common stock made a 25 per cent reduction in its issued outstanding second preferred stock and simultaneously amended its charter, changing its authorized issue of common stock of 10,000 shares, of par value of $100 each, to 10,000 shares, without par value.
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A corporation having first and second preferred stock and common stock made a 25 per cent reduction in its issued outstanding second preferred stock and simultaneously amended its charter, changing its authorized issue of common stock of 10,000 shares, of par value of $100 each, to 10,000 shares, without par value. At that time, there were 19 holders of second preferred stock of whom, including petitioners, seven were directors who owned all the outstanding (35) shares of common stock, each director owning five shares thereof. When the 25 per cent reduction in second preferred stock was made…
1Opinion of the Court
*436OPINION.
Sea well:
It is stated in behalf of the petitioners that neither this Board nor the courts have rendered any decision on the issue raised by the facts of this case.
In this instance, as in numerous others, the directors and stockholders of the Kistler Leather Co. deemed it advisable to eliminate an existing deficit in order to present a better financial aspect of the corporate business. With a view to accomplishing such result, the second preferred stockholders, of whom there were nineteen, seven being directors, of whom petitioners were two, pursuant to action of the stockholders and…
2Cited by9 opinions
- Downer v. CommissionerUnited States Tax Court · 1967
- Bed Rock Petroleum Co. v. CommissionerUnited States Board of Tax Appeals · 1933
- Muchnic v. CommissionerUnited States Board of Tax Appeals · 1933
- Haass v. CommissionerUnited States Board of Tax Appeals · 1934
- Downer v. CommissionerUnited States Tax Court · 1967
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