GEESEMAN v. COMMISSIONER
United States Board of Tax Appeals
In March 1931, the petitioner was given an option by a corporation by which he was employed to purchase a stated number of shares of stock in the corporation at a price below the current market. According to the terms of the offer the shares could be purchased in stated amounts on and after specified dates extending over a period of more than four years.
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In March 1931, the petitioner was given an option by a corporation by which he was employed to purchase a stated number of shares of stock in the corporation at a price below the current market. According to the terms of the offer the shares could be purchased in stated amounts on and after specified dates extending over a period of more than four years. Prior to the purchase of any shares by petitioner the current market price declined below the option price and the corporation reduced the option price to an amount below the then market price. Thereafter, in 1933, when the market price for…
1Opinion of the Court
*262OPINION.
TurneR:
The respondent contends that the option granted the petitioner “by its terms was strictly an employment of service contract” and that the difference between the price paid for the shares of stock and their fair market value on the date of purchase was additional compensation received by him as an employee of Continental Can Co. The petitioner contends that his purchase of stock was a “bargain” purchase and that such acquisition does not result in the realization of gain until the shares are sold or otherwise disposed of at a profit. In the alternative, he contends that if the…
2Cases cited1 opinion
- Burnet v. LoganSupreme Court of the United States · 1931
3Cited by3 opinions
- Commissioner of Internal Revenue v. Philip J. Lo BueCourt of Appeals for the Third Circuit · 1955
- Bowen v. CommissionerUnited States Tax Court · 1954
- GEESEMAN v. COMMISSIONERUnited States Board of Tax Appeals · 1938