Lucius Pitkin, Inc. v. Commissioner
United States Tax Court
Petitioner, in accordance with the desire of two of its stockholders, each holding one-third of its stock, to eliminate the holder of the other one-third, and pursuant to agreement, transferred to him certain of its assets, and various other matters between the stockholders were settled. The one-third of the stock was surrendered and canceled, though a few days later a dividend thereof, in equal amounts was declared to the two remaining stockholders.
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Petitioner, in accordance with the desire of two of its stockholders, each holding one-third of its stock, to eliminate the holder of the other one-third, and pursuant to agreement, transferred to him certain of its assets, and various other matters between the stockholders were settled. The one-third of the stock was surrendered and canceled, though a few days later a dividend thereof, in equal amounts was declared to the two remaining stockholders. Held, on the facts, that there was partial liquidation, and not sale of the corporate assets for stock, that the petitioner did not deal in its…
1Opinion of the Court
OPINION.
Disney, Judge:
The question to be determined is whether the petitioner sustained a loss from the distribution in kind of certain of its assets to one of its three stockholders in exchange for one-third of its outstanding common stock held by that stockholder. Petitioner’s primary argument is based on the application of section 29.22 (a)-15 of Regulations 111.1 The respondent argues primarily that there was a distribution in kind in partial liquidation under section 115 of the Internal Revenue Code, and that under Regulations 111, section 29.22 (a)-20,2 no gain or loss was realized.
After…
2Cases cited1 opinion
- Brockman Oil Well Cementing Co. v. CommissionerUnited States Tax Court · 1943
3Cited by6 opinions
- Gravois Planing Mill Company, Charles A. And Florence Beckemeier v. Commissioner of Internal RevenueCourt of Appeals for the Eighth Circuit · 1962
- The Farmers Union Corporation v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1962
- Johnson, Carvell & Murphy v. RiddellDistrict Court, S.D. California · 1959
- Farmers Union Corp. v. CommissionerUnited States Tax Court · 1960
- Gravois Planing Mill Co. v. CommissionerUnited States Tax Court · 1960
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