Peabody Natural Res. Co. v. Comm'r
United States Tax Court
A partnership exchanged operating gold mines, including realty, for operating coal mines. The coal mines were subject to two coal supply contracts that obligated the mine owner to provide electric utilities with coal. The benefits and obligations under the contracts were governed by New Mexico law. The gold mines were not subject to supply contracts. The partnership treated the entire exchange as "tax free" under sec. 1031, I.R.C.
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A partnership exchanged operating gold mines, including realty, for operating coal mines. The coal mines were subject to two coal supply contracts that obligated the mine owner to provide electric utilities with coal. The benefits and obligations under the contracts were governed by New Mexico law. The gold mines were not subject to supply contracts. The partnership treated the entire exchange as "tax free" under sec. 1031, I.R.C. R determined that the coal supply contracts were not real property and/or like-kind property and constituted "boot" so that the value of the supply contracts would…
1Opinion of the Court
PEABODY NATURAL RESOURCES COMPANY, f.k.a. HANSON NATURAL RESOURCES COMPANY, CAVENHAM FOREST INDUSTRIES, INC., A PARTNER OTHER THAN THE TAX MATTERS PARTNER, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
Peabody Natural Res. Co. v. Comm'r
Nos. 20328-04, 6899-05
United States Tax Court
126 T.C. 261; 2006 U.S. Tax Ct. LEXIS 14; 126 T.C. No. 14; 167 Oil & Gas Rep. 668;
May 8, 2006, Filed
A partnership exchanged operating gold mines, including realty,
for operating coal mines. The coal mines were subject to two
coal supply contracts that obligated the mine owner to provide
electric utilities…
2Cases cited26 opinions
- Sundstrand Corporation v. Commissioner of Internal RevenueCourt of Appeals for the Seventh Circuit · 1994
- Sundstrand Corp. v. CommissionerUnited States Tax Court · 1992
- Commissioner v. P. G. Lake, Inc.Supreme Court of the United States · 1958
- Florida Peach Corp. v. CommissionerUnited States Tax Court · 1988
- Craig v. Comm'rUnited States Tax Court · 2002
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