Handelman v. Commissioner
United States Tax Court
The transferor corporation sold its notes and contracts at less than their face value but at more than their adjusted basis, and liquidated under a plan of complete liquidation.
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The transferor corporation sold its notes and contracts at less than their face value but at more than their adjusted basis, and liquidated under a plan of complete liquidation. Held, that the corporation is not entitled to deduct any addition to its reserve for bad debts; that the respondent properly restored to the reserve an amount received upon sale of certain of the notes and contracts which had previously been charged against the reserve as being worthless; and that the balance in the reserve is taxable as ordinary income to the corporation.
1Opinion of the Court
Atkins, Judge:
The respondent determined liabilities against the petitioners Ira Handelman and Ida Handelman as transferees of the assets of Employees Finance Corporation (hereinafter referred to as the corporation or as the transferor), and against Harry Freeman as transferee and fiduciary or liquidating agent of the assets of the transferor, for an income tax deficiency of $40,828.97 determined against the transferor for its taxable year ended January 31, 1955, as follows:
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The issues are (1) whether the respondent properly disallowed a deduction claimed by the transferor for an…
2Cases cited7 opinions
- Geyer, Cornell & Newell, Inc. v. CommissionerUnited States Tax Court · 1946
- West Seattle National Bank of Seattle v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1961
- West Seattle Nat'l Bank v. CommissionerUnited States Tax Court · 1959
- McCamant v. CommissionerUnited States Tax Court · 1959
- Arcadia Sav. & Loan Asso. v. CommissionerUnited States Tax Court · 1960
2 more not listed; retrieve them via the Exa API.
3Cited by30 opinions
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- James M. Pierce Corp. v. CommissionerUnited States Tax Court · 1962
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