Aaron M. Stover and Dixie Stover v. Commissioner of Internal Revenue

WOLLMAN, Circuit Judge.

The Commissioner of Internal Revenue terminated the Subchapter S election of Forest Knolls Estates, Inc. (Corporation), a Minnesota corporation, for taxable years 1979 and 1980. Appellant-shareholders, Aaron and Dixie Stover, seek reversal of the Tax Court decision which sustained Commissioner’s action. 53 T.C.M. (P-H) 1184 (1984). The Tax Court ruled that Commissioner had properly terminated Corporation’s Subchapter S election pursuant to section 1372(e)(5)(A) of the Internal Revenue Code of 1954, 1 which provides that an election under Subchapter S terminates if an…