Haber v. Commissioner
United States Tax Court
Petitioner and his brother were the sole stockholders and officers of Beacon Sales Co. The basis of petitioner's stock in such corporation was $ 15,000. The corporation filed an election under the provisions of sec. 1372, subch.
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Petitioner and his brother were the sole stockholders and officers of Beacon Sales Co. The basis of petitioner's stock in such corporation was $ 15,000. The corporation filed an election under the provisions of sec. 1372, subch. S of the Internal Revenue Code of 1954, which was in effect from 1960 through the taxable year of petitioner ending Dec. 31, 1964. On June 30, 1961, an amount representing the loans which the corporation had made to petitioner, $ 14,380.05, was charged to the earned surplus of Beacon Sales Co. and a corresponding credit was made to petitioner's loan account. No income…
1Opinion of the Court
OPINION'
The initial issue presented for decision is whether the forgiveness by Beacon Sales Co., a subchapter S corporation, of indebtedness owed by a shareholder, petitioner Jack Haber, should be treated as a distribution of property resulting in a corresponding reduction of the basis of the shareholder’s stock in such corporation. An affirmative determination of this issue would require the holding, pursuant to section 1374(c) (2), that petitioner was not entitled to deduct a prorata amount of the net operating losses incurred by Beacon Sales Co. in subsequent taxable years.
Beacon Sales Co.…
2Cases cited4 opinions
- Wilson v. CommissionerUnited States Tax Court · 1948
- Wilson Bros. & Co. v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1948
- Wackenhut Corp. v. International Union, United Plant Guard Workers of AmericaCourt of Appeals for the Ninth Circuit · 1964
- Rita G. Shephard, Guardian of Susan Shephard v. Commissioner of Internal RevenueCourt of Appeals for the Sixth Circuit · 1965
3Cited by88 opinions
- Electric & Neon, Inc. v. CommissionerUnited States Tax Court · 1971
- Haag v. CommissionerUnited States Tax Court · 1987
- Fisher v. CommissionerUnited States Tax Court · 1970
- Pierce v. CommissionerUnited States Tax Court · 1974
- Michael v. Frierdich and Connie J. Frierdich v. Commissioner of Internal RevenueCourt of Appeals for the Seventh Circuit · 1991
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