Aldrich v. Commissioner
United States Tax Court
The three taxpayers inherited all the shares of an insolvent corporation and a claim against it. Dissolution was then considered. They authorized the corporation to transfer the assets to them as creditors. This was done and the corporation dissolved. Held, the amount received by the taxpayers is not a liquidating distribution, of which only a percentage would be taxable, but the gain is ordinary income, of which all is taxable.
1Opinion of the Court
OPINION.
SteRnhagen, Judge:
There is no dispute as to the basis to petitioners of the claim and stock and the amounts received by them or the times of receipt. They argue upon the proposition that the amounts were received by them as shareholders of the corporation in distribution of its assets in liquidation, and, as such, were, according to the Revenue Acts of 1936 and 1938, section 115 (c), to be treated as in payment “in exchange for the stock.” So treated, they are taxable as capital gains, which are limited to the percentages stated in sections 117 (a) of the 1936 Act and 117 (b) of the…
2Cases cited1 opinion
- Helvering v. Alabama Asphaltic Limestone Co.Supreme Court of the United States · 1942
3Cited by8 opinions
- Jorden v. CommissionerUnited States Tax Court · 1948
- Braddock Land Co. v. CommissionerUnited States Tax Court · 1980
- Crown v. CommissionerUnited States Tax Court · 1972
- Aldrich v. CommissionerUnited States Tax Court · 1943
- Braddock Land Co. v. CommissionerUnited States Tax Court · 1980
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