J. C. Penney Co. v. Commissioner
United States Tax Court
Liquidation of Subsidiary -- Recognition of Gain -- Sec. 392 and Sec. 337, I.R.C. 1954. -- In 1954, J. C. Penney Building and Realty Corporation, a wholly owned subsidiary of J. C. Penney Company, sold part of its assets, then adopted a plan of complete liquidation and completely liquidated before January 1, 1955. Held: The gain on the sale is recognized.
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Liquidation of Subsidiary -- Recognition of Gain -- Sec. 392 and Sec. 337, I.R.C. 1954. -- In 1954, J. C. Penney Building and Realty Corporation, a wholly owned subsidiary of J. C. Penney Company, sold part of its assets, then adopted a plan of complete liquidation and completely liquidated before January 1, 1955. Held: The gain on the sale is recognized. Petitioner's contention that the recognition of gain depended on whether or not the sale was made prior to or following the adoption of the plan of liquidation rejected.
1Opinion of the Court
OPINION.
Train, Judge:
The Commissioner determined an overassessment of $171.17 for the taxable year ended December 31,1953, and a deficiency of $471,029.11 for the period January 1, 1954, to November 30, 1954.
The sole question is whether the gain from the sale of certain property by J. C. Penney Building and Realty Corporation is to be recognized in view of its election to have section '392 (b) of the 1954 Code apply.
All of the facts have been stipulated and are hereby found as stipulated.
The petitioner, J. C. Penney Company (hereinafter sometimes referred to as J. C. Penney), is a corporation…
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