Southern Dredging Corp. v. Commissioner

OPINION

The issues presented for our decision are whether all or any of the petitioners were incorporated for the principal purpose of evasion or avoidance of Federal income tax, within the purview of section 269, by securing the benefit of the surtax exemption.

Section 11(d) provides an exemption of $25,000 in imposing the surtax on the taxable income of a corporation. The right to this exemption is sometimes qualified in the application of section 269(a), which provides, in pertinent part, as follows:

SEO. 269. ACQUISITIONS MADE TO EVADE OR. AVOID INCOME TAX.(a) In GENERAL. — If—(1) any person…