Commissioner of Internal Revenue v. Marne S. Wilson, Marjorie M. Wilson, Lyle C. Wilson and Peggy Wilson

MADDEN, Judge:

The Commissioner of Internal Revenue seeks review and reversal by this court of a decision of the Tax Court of the United States setting aside income tax deficiencies which the Commissioner had assessed agáinst these taxpayers. No problem relating to the jurisdiction of the Tax Court or of this court is involved.

Our question is whether the Tax Court was right in concluding that when a corporation in which the taxpayers were the sole stockholders formed another corporation, transferred certain assets of the existing corporation to it, and then transferred the stock in the second…