Ohio Cent. Tel. Co. v. Commissioner
United States Board of Tax Appeals
1. Where the nontaxable profit resulting from the sale of the stock of a subsidiary corporation is included in a lump sum received for such stock and the bonds of the same subsidiary, and there are no facts establishing the separate cost of the stock, the claim for the noninclusion of such profit in income is not sustained by evidence and the determination of the Commissioner that the entire profit is taxable must be approved. 2. Where a taxpayer corporation sells the bonds…
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1. Where the nontaxable profit resulting from the sale of the stock of a subsidiary corporation is included in a lump sum received for such stock and the bonds of the same subsidiary, and there are no facts establishing the separate cost of the stock, the claim for the noninclusion of such profit in income is not sustained by evidence and the determination of the Commissioner that the entire profit is taxable must be approved. 2. Where a taxpayer corporation sells the bonds of an affiliate, the whole amount of gain realized is taxable. United States v. Kirby Lumber Co.,284 U.S. 1, followed.
1Opinion of the Court
*98OPINION.
Lansdon:
The facts material to the proceeding have been stipulated. The only question is whether petitioner realized a profit of $168,090.86 when it sold the bonds and stock of its subsidiary corporation, the Ohio Central Telephone Corporation, in the taxable year. Petitioner contends that the result of the transaction is nontaxable, since the property sold consisted entirely of the securities of an affiliated corporation and was in effect the sale of its own bonds and stock. In support of its position it relies on our decisions in Simmons & Hammond Mfg. Co., 1 B.T.A. 803; Farmers…
2Cases cited7 opinions
- Old Colony Railroad v. CommissionerSupreme Court of the United States · 1932
- United States v. Kirby Lumber CoSupreme Court of the United States · 1931
- Farmers Deposit Nat'l Bank v. CommissionerUnited States Board of Tax Appeals · 1926
- Simmons & Hammond Mfg. Co. v. CommissionerUnited States Board of Tax Appeals · 1925
- H. S. Crocker Co. v. CommissionerUnited States Board of Tax Appeals · 1926
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3Cited by1 opinion
- Ohio Cent. Tel. Co. v. CommissionerUnited States Board of Tax Appeals · 1933