Magic Mart, Inc. v. Commissioner
United States Tax Court
Held, petitioner's earnings and profits for the taxable years 1959 through 1962 were not permitted to accumulate beyond the reasonable needs of petitioner's business including the reasonably anticipated needs of the business.
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Held, petitioner's earnings and profits for the taxable years 1959 through 1962 were not permitted to accumulate beyond the reasonable needs of petitioner's business including the reasonably anticipated needs of the business. Held, further, in view of the credit provided for in sec. 535 (c)(1) of the 1954 Code, it is unnecessary to consider whether petitioner was availed of for the proscribed purpose and, therefore, petitioner is not liable for the accumulated earnings tax imposed by sec. 531 of the 1954 Code. See secs. 531 through 537.
1Opinion of the Court
Sterrett, Judge :1
Respondent determined deficiencies in petitioner’s income tax for the calendar years 1959 through 1962 in amounts, as follows:
Tear Deficiency
1959 _34,617.34
1960 - 5,029.46
1961_ 5,219.49
1962 _ 6,004.06
The only issue for decision is wb.eth.er, for the taxable years in question, petitioner was availed of for the ¡purpose of avoiding income tax with respect to its shareholders by permitting earnings and profits to accumulate instead of being divided or distributed, and is thus subject to the accumulated earnings tax imposed by section 581 of the 1954 Code.
FINDINGS OF FACT
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2Cases cited23 opinions
- United States v. Donruss Co.Supreme Court of the United States · 1969
- The Smoot Sand & Gravel Corporation v. Commissioner of Internal RevenueCourt of Appeals for the Fourth Circuit · 1960
- Dixie, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1960
- The Smoot Sand & Gravel Corporation v. Commissioner of Internal RevenueCourt of Appeals for the Fourth Circuit · 1957
- Faber Cement Block Co. v. CommissionerUnited States Tax Court · 1968
18 more not listed; retrieve them via the Exa API.
3Cited by52 opinions
- Dielectric Materials Co. v. CommissionerUnited States Tax Court · 1972
- Atlas Tool Co. v. CommissionerUnited States Tax Court · 1978
- Phillip B. Hardin v. United States of America, Hardin's Bakeries Corporation v. United States of America, (Two Cases)Court of Appeals for the Fifth Circuit · 1972
- Rutter v. CommissionerUnited States Tax Court · 1983
- Doug-Long, Inc. v. CommissionerUnited States Tax Court · 1979
47 more not listed; retrieve them via the Exa API.