Monarch Elec. & Wire Co. v. Commissioner
United States Board of Tax Appeals
1. A owned 52 per cent of the capital stock of a corporation, and B, C and D owned 42 per cent of the capital stock. On January 1, 1920, all of the assets of the corporation, except certain securities which were paid directly to A, were transferred to a new corporation, the petitioner, which issued all of its capital stock in exchange therefor, the capital stock so issued being divided 48 per cent to A, and 52 per cent to B, C, and D. Held, that the provision of section 331…
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1. A owned 52 per cent of the capital stock of a corporation, and B, C and D owned 42 per cent of the capital stock. On January 1, 1920, all of the assets of the corporation, except certain securities which were paid directly to A, were transferred to a new corporation, the petitioner, which issued all of its capital stock in exchange therefor, the capital stock so issued being divided 48 per cent to A, and 52 per cent to B, C, and D. Held, that the provision of section 331 of the Revenue Act of 1918, and section 331 of the Revenue Act of 1921, prohibits a new corporation from valuing the…
1Opinion of the Court
*160OPINION.
Maequette:
It is the contention of the petitioner that the fair market value of the assets acquired by it from the old corporation is the amount at which they should be included in the petitioner’s invested capital, and also the basis for computing the yearly allowance for exhaustion, wear and tear of the assets. It also claims that the allowance for exhaustion, wear and tear should be computed at the rate of 4 per cent for the building, and 10 per cent for machinery and equipment. The respondent urges that under section 331 of the Revenue Act of 1918 and section 331 of the Revenue Act…
2Cited by4 opinions
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- Durand-McNeil-Horner Co. v. CommissionerUnited States Board of Tax Appeals · 1934
- Monarch Elec. & Wire Co. v. CommissionerUnited States Board of Tax Appeals · 1928