Dudley v. Commissioner
United States Tax Court
1. Held, that the formation of National Tanker Corporation by stockholders of American Overseas Tanker Corporation (AOTC), the transfer to National of AOTC's right to purchase certain tankers, and the ultimate sale of National stock to United Tanker Corporation were merely steps in a transaction designed as a sale of the tankers by AOTC to United at a profit to AOTC of $ 450,000; hence, the distribution of that amount to National stockholders, petitioners herein, was in…
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1. Held, that the formation of National Tanker Corporation by stockholders of American Overseas Tanker Corporation (AOTC), the transfer to National of AOTC's right to purchase certain tankers, and the ultimate sale of National stock to United Tanker Corporation were merely steps in a transaction designed as a sale of the tankers by AOTC to United at a profit to AOTC of $ 450,000; hence, the distribution of that amount to National stockholders, petitioners herein, was in effect a dividend to them from AOTC. 2. Held, further, that United's promissory note was intended merely as evidence of its…
1Opinion of the Court
OPINION.
Raum, Judge:
1. This case presents a variation of the familiar problem of substance versus form. Petitioners contend that the transaction under review was simply a sale of 1,000 shares of National stock at $450 a share which had been acquired at $1 a share, and that the difference represents long-term capital gain. Respondent’s determination, on the other hand, proceeds upon the assumption that the substance underlying this apparently simple sale of stock was entirely different, namely, that the purported sale of the National stock was merely the final step in a transaction designed…
2Cases cited19 opinions
- Commissioner v. Court Holding Co.Supreme Court of the United States · 1945
- Moline Properties, Inc. v. CommissionerSupreme Court of the United States · 1943
- Griffiths v. CommissionerSupreme Court of the United States · 1939
- United States v. Cumberland Public Service Co.Supreme Court of the United States · 1950
- Kimbell-Diamond Milling Co. v. Comm'rUnited States Tax Court · 1950
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3Cited by1 opinion
- Dudley v. CommissionerUnited States Tax Court · 1959