Wolff v. Director of Revenue

BLACKMAR, Chief Justice.

Wolff Shoe Corporation is a Missouri corporation engaged primarily in the distribution of shoes made in foreign countries. Substantially all of its sales take place outside the state of Missouri. Wolff Shoe Company v. Director of Revenue, 762 S.W.2d 29 (Mo. banc 1988). In 1984 it elected to become an S corporation, as defined by § 1361(a)(1) of the Internal Revenue Code of 1954, and § 143.471, RSMo 1986.

The appellant taxpayers, all residents of Missouri, are the four principal shareholders of Wolff Shoe. For the years 1985 and 1986 they reported on their Missouri…