Golden Cycle Corp. v. Commissioner
United States Board of Tax Appeals
On January 15, 1917, corporation A formed corporation B with a capital stock of $100,000, and transferred to it a part of its (A's) assets having a value of $1,344,355.28, in consideration for the issuance to A corporation of the entire capital stock of B corporation, thereby creating an affiliation of the two corporations.
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On January 15, 1917, corporation A formed corporation B with a capital stock of $100,000, and transferred to it a part of its (A's) assets having a value of $1,344,355.28, in consideration for the issuance to A corporation of the entire capital stock of B corporation, thereby creating an affiliation of the two corporations. The statutory cost for invested capital purposes to A corporation of the assets transferred to B corporation was much less than their value on January 15, 1917. Held that by the transaction in question the consolidated group merely acquired a part of its own capital stock…
1Opinion of the Court
*121OPINION.
Littleton:
The issue in this case arises as the result of events which occurred substantially as follows: The Golden Cycle Co. and the Fuel Company were in existence prior to 1917 and between 1909 and 1916 the former company acquired almost all the capital stock and bonds of the latter. On January 15, 1917, as the result of the Fuel Company being in default on the payment of interest on its bonds and for the purpose of securing a reorganization of that company, the Golden Cycle Co. foreclosed on the bonds of the Fuel Company and purchased the assets of the Fuel Company for $124,-000,…
2Cited by1 opinion
- Golden Cycle Corp. v. CommissionerUnited States Board of Tax Appeals · 1929