Fullerton v. Commissioner
United States Tax Court
Trust formed to hold property on behalf of former corporate shareholders pending discharge of mortgage liability thereon held, on facts, not conducting business and hence not taxable as a corporation so as to result in realization of capital gain by beneficiary upon termination of trust.
1Opinion of the Court
OPINION.
Offer, Judge:
Before it may be determined that an association is taxable as a corporation we must first find that the purpose was to carry on business under the guise of a trust.1 Where the operation is undertaken either as a liquidating process or “to hold and conserve particular property with incidental powers as in the traditional type of trusts,” Morrissey v. Commissioner, 296 U. S. 344, it has been held that the business aspects are lacking.
It seems to us evident from the facts that the present trust was but a step in the liquidation of the Fullerton Groves Corporation. In order…
2Cases cited7 opinions
- Morrissey v. CommissionerSupreme Court of the United States · 1935
- A. A. Lewis & Co. v. CommissionerSupreme Court of the United States · 1937
- Garrett v. United StatesUnited States Court of Claims · 1954
- Commissioner of Internal Revenue v. Chase Nat. BankCourt of Appeals for the Second Circuit · 1941
- Estate of Ferber v. CommissionerUnited States Tax Court · 1954
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3Cited by1 opinion
- Fullerton v. CommissionerUnited States Tax Court · 1954