W. G. Maguire & Co. v. Commissioner

OPINION.

Black, Judge:

The three petitioners have in common the fact that during the taxable year 1944, they were three of the many stockholders of Mokan corporation.

The principal issue here relates to the distributions made by Mokan to its stockholders during the taxable year. Mokan distributed an aggregate of $878,584.80 in cash, and, in addition, rights entitling its stockholders to purchase Panhandle Eastern Pipe Line Company shares at $30 per share. Of the 163,710 shares offered to stockholders, Mokan sold through the exercise of rights a total of 151,958 shares. Respondent determined that…