FX Systems Corp. v. Commissioner
United States Tax Court
Petitioner purchased certain assets for $ 200,000 in cash, a promissory note of $ 28,000, 500 shares of its series A preferred stock, and 500 shares of its series B preferred stock. Petitioner claimed a cost basis in the purchased assets in an amount equal to the fair market value thereof. Respondent, however, determined that petitioner's preferred stock could not be valued by reference to the value of the assets purchased.
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Petitioner purchased certain assets for $ 200,000 in cash, a promissory note of $ 28,000, 500 shares of its series A preferred stock, and 500 shares of its series B preferred stock. Petitioner claimed a cost basis in the purchased assets in an amount equal to the fair market value thereof. Respondent, however, determined that petitioner's preferred stock could not be valued by reference to the value of the assets purchased. Held, under the facts of the instant case, it cannot be presumed that the fair market value of the assets petitioner purchased is equal to the value of the consideration…
1Opinion of the Court
OPINION
Hamblen, Judge: *
Respondent determined the following deficiencies in petitioner’s Federal income taxes:
Deficiencies TYE Mar. 31-
$129,929 1973 .
1974 . 65,095
1975 . 8,646
After concessions, the sole issue for decision is the amount of petitioner’s cost basis in certain assets that it purchased from Ferroxcube Corp.
All of the facts have been stipulated and are found accordingly.
Petitioner FX Systems Corp. is a Delaware corporation with its principal office in Kingston, N.Y. For the taxable years ended March 31, 1973, 1974, and 1975, petitioner timely filed its Federal corporate income tax…
2Cases cited7 opinions
- Philadelphia Park Amusement Co. v. United StatesUnited States Court of Claims · 1954
- Seas Shipping Company, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1967
- Pittsburgh Terminal Corp. v. CommissionerUnited States Tax Court · 1973
- Moore-McCormack Lines, Inc. v. CommissionerUnited States Tax Court · 1965
- Simmonds Precision Prods. v. Comm'rUnited States Tax Court · 1980
2 more not listed; retrieve them via the Exa API.
3Cited by3 opinions
- Pabst Brewing Co. v. CommissionerUnited States Tax Court · 1995
- FX Systems Corp. v. CommissionerUnited States Tax Court · 1982
- Liquid Air Corp. v. CommissionerUnited States Tax Court · 1995