Cox v. Commissioner
United States Tax Court
Petitioners owned 100 percent of the stock of RCI and New Roanoke. On Jan. 2, 1974, petitioners sold all of their New Roanoke stock to RCI in exchange for five notes, in the amount of $ 20,000 each, payable beginning in 1975. RCI had no earnings and profits at the time. Petitioners realized $ 98,000 long-term capital gain from the transaction.
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Petitioners owned 100 percent of the stock of RCI and New Roanoke. On Jan. 2, 1974, petitioners sold all of their New Roanoke stock to RCI in exchange for five notes, in the amount of $ 20,000 each, payable beginning in 1975. RCI had no earnings and profits at the time. Petitioners realized $ 98,000 long-term capital gain from the transaction. Held, sec. 304(a)(1), I.R.C. 1954, recast the stock sale as a contribution to capital followed by a redemption distribution to which sec. 301 applies and thus no "sale" took place under sec. 453. Held, further, sec. 301(c)(3)(A) only characterizes the…
1Opinion of the Court
Rufus K. Cox, Jr., and Ethel M. Cox, Petitioners v. Commissioner of Internal Revenue, Respondent
Cox v. Commissioner
Docket No. 10115-78
United States Tax Court
78 T.C. 1021; 1982 U.S. Tax Ct. LEXIS 81; 78 T.C. No. 73;
June 15, 1982, Filed
Decision will be entered under Rule 155.
Petitioners owned 100 percent of the stock of RCI and New Roanoke. On Jan. 2, 1974, petitioners sold all of their New Roanoke stock to RCI in exchange for five notes, in the amount of $ 20,000 each, payable beginning in 1975. RCI had no earnings and profits at the time. Petitioners realized $ 98,000 long-term capital gain…
2Cases cited22 opinions
- Griffiths v. CommissionerSupreme Court of the United States · 1939
- Avery v. CommissionerSupreme Court of the United States · 1934
- United States v. DavisSupreme Court of the United States · 1970
- Burnet v. S. & L. Building Corp.Supreme Court of the United States · 1933
- The Cappel House Furnishing Company v. United StatesCourt of Appeals for the Sixth Circuit · 1957
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