Reitz v. Commissioner
United States Tax Court
Petitioners gave all the stock of a corporation to a local governmental agency immediately after the corporation had declared and paid a "dividend" of all cash and accounts for services rendered prior to the date of the gift. Approximately 4 months after the gift, the corporation was dissolved by the governmental agency. Held, the distribution was a dividend in substance as well as in form and cannot be treated as the proceeds of a sale, redemption, or partial liquidation.
1Opinion of the Court
OPINION
Tietjens, Judge:
The Commissioner determined the following deficiencies in petitioners’ income taxes:
Taxable year Deficiency
1968 _$13, 533. 54
1969 _ 1,160.34
This case was fully stipulated pursuant to Rule 122, Tax Court Rules of Practice and Procedure. The facts which we deem necessary for decision will be referred to below.
Certain concessions have been made and the only question remaining for decision is whether a distribution in 1968 should be treated as ordinary income resulting from a dividend as defined by section 316 1 or as the capital gains resulting from a sale, redemption, or…
2Cases cited30 opinions
- Gregory v. HelveringSupreme Court of the United States · 1935
- Zenz v. QuinlivanCourt of Appeals for the Sixth Circuit · 1954
- United States v. General Geophysical CompanyCourt of Appeals for the Fifth Circuit · 1961
- Television Industries, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1960
- Redwing Carriers, Inc. v. TomlinsonCourt of Appeals for the Fifth Circuit · 1968
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3Cited by10 opinions
- Estate of Durkin v. CommissionerUnited States Tax Court · 1992
- Lisle v. CommissionerUnited States Tax Court · 1976
- Midwest Sav. Asso. v. CommissionerUnited States Tax Court · 1980
- Estate of Colley v. CommissionerUnited States Tax Court · 1980
- Uniroyal, Inc. v. CommissionerUnited States Tax Court · 1993
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