Alexander v. Commissioner
United States Tax Court
1. In 1941 petitioners owned stock in CC Corporation which owned oil and gas properties. Petitioners sold their stock for cash and overriding royalty interests in the oil and gas properties. At the time of the sale, the overriding royalty interests had a fair market value.
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1. In 1941 petitioners owned stock in CC Corporation which owned oil and gas properties. Petitioners sold their stock for cash and overriding royalty interests in the oil and gas properties. At the time of the sale, the overriding royalty interests had a fair market value. Held, payments from the overriding royalty interests received by petitioners during the years in issue, 1954, 1955, and 1956, are taxable as ordinary income subject to depletion and not as long-term capital gain. Warren v. United States, 171 F. Supp. 846, certiorari denied 361 U.S. 916, followed. 2. Bad debt losses…
1Opinion of the Court
OPINION.
Black, Judge:
We shall consider the issues in the same order in which the facts pertinent to each are set forth in our Findings of Fact.
Issue 1. Royalty Payments as Ordinary Income or Long-Term Capital Cain.
The first issue presented is whether payments received by petitioners during the years in issue on overriding royalty interests received on the sale of their stock in Corpus Christi are taxable as ordinary income subject to depletion or as long-term capital gain. Petitioners, on their income tax returns, treated these payments as ordinary income subject to 27^ per cent depletion.…
2Cases cited8 opinions
- Commissioner v. P. G. Lake, Inc.Supreme Court of the United States · 1958
- Helvering v. Bankline Oil Co.Supreme Court of the United States · 1938
- Campbell v. CommissionerUnited States Tax Court · 1948
- Towers v. CommissionerUnited States Tax Court · 1955
- Vincent C. Giblin v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1955
3 more not listed; retrieve them via the Exa API.
3Cited by1 opinion
- Alexander v. CommissionerUnited States Tax Court · 1960