Fidelity Commercial Co. v. Commissioner
United States Tax Court
Petitioner sought to exclude itself from classification as a personal holding company on the ground that it was a lending and finance company satisfying all the requirements of sec. 542(c)(6). In 1965 one of its shareholders, who owned more than 10 percent in value of its outstanding stock, withdrew from petitioner amounts in excess of $ 5,000. Held, the withdrawals were in fact loans within the meaning of sec. 542(c)(6)(D) and, therefore, petitioner was a personal holding…
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Petitioner sought to exclude itself from classification as a personal holding company on the ground that it was a lending and finance company satisfying all the requirements of sec. 542(c)(6). In 1965 one of its shareholders, who owned more than 10 percent in value of its outstanding stock, withdrew from petitioner amounts in excess of $ 5,000. Held, the withdrawals were in fact loans within the meaning of sec. 542(c)(6)(D) and, therefore, petitioner was a personal holding company during 1965.
1Opinion of the Court
FoeeesteR, Judge:
Respondent has determined a deficiency of $47,476.65 in petitioner’s income tax for the taxable year 1965.
As petitioner has made certain concessions, the sole issue we must decide is whether petitioner made at any time during 1965 excessive loans to its majority stockholder so as to fail to meet the section 542(c) (6) (D)1 requirement for exception to the definition of personal holding company.
BINDINGS OP PACT
Some of the facts have been stipulated and are so found. The stipulation and the exhibits appended thereto are incorporated herein by this reference.
Petitioner is a…
2Cases cited14 opinions
- Estate of E. W. Chism, Deceased, Clara Chism, and Clara Chism v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1963
- Paul W. Berthold and Dorothy Berthold v. Commissioner of Internal RevenueCourt of Appeals for the Sixth Circuit · 1968
- Rose v. CommissionerUnited States Tax Court · 1970
- Hans Zimmerman and Clara Zimmerman, Apellants v. United States of America and District Director of Internal RevenueCourt of Appeals for the Ninth Circuit · 1963
- Rude v. CommissionerUnited States Tax Court · 1967
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