Cox v. Commissioner
United States Tax Court
1. Good Will. -- Held, on facts that $ 50,000 received by petitioners for the sale of the business is consideration for good will and taxable as capital gain. 2. Repairs or Capital Expenditures. -- Aggregate expenditures made by the petitioners pursuant to a general plan of reconditioning, improving and altering newly acquired property, held to be capital expenditures. Home News Publishing Co., 18 B. T. A. 1008, followed.
1Opinion of the Court
OPINION.
Johnson, Judge:
Petitioners contend that having s.old the physical equipment of W. H. Cox & Sons by oral contract for book value, the $50,000 received by them for the sale of the business constitutes consideration for good will and henee is taxable as capital gain.. Respondent determined that the $50,000 was consideration for a cover nant not to compete, and hence treated the money as ordinary income. See Aaron Michaels, 12 T. C. 17.
It seems evident from the terms of the written contract set out in our findings that petitioners received $50,000 for the sale of the business and that…
2Cases cited2 opinions
- Michaels v. CommissionerUnited States Tax Court · 1949
- Black Hardware Co. v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1930
3Cited by6 opinions
- United States v. W. J. Wehrli and Helen B. WehrliCourt of Appeals for the Tenth Circuit · 1968
- Jerome S. Moss, Sandra Moss, Sharon M. Alesia, Herb Alpert, and Lani Alpert v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1987
- True v. United StatesCourt of Appeals for the Tenth Circuit · 1990
- True v. United StatesCourt of Appeals for the Tenth Circuit · 1990
- Bayly v. CommissionerUnited States Tax Court · 1981
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