Floyd W. Bell v. Commissioner of Internal Revenue

Sixth Circuit

Floyd W. Bell v. Commissioner of Internal Revenue

248 F.2d 947

CourtCourt of Appeals for the Sixth Circuit

DecidedOctober 25, 1957

Docket13089

StatusPublished

Cited by2 cases

This text of 248 F.2d 947 (Floyd W. Bell v. Commissioner of Internal Revenue) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Floyd W. Bell v. Commissioner of Internal Revenue, 248 F.2d 947 (6th Cir. 1957).

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Opinion

PER CURIAM.

On this petition for review of decisions of the Tax Court of the United States, the petitioners are stockholders of the Buckeye Stamping Company who were not parties to the contest made by certain other stockholders of that company identically situated.

In the former litigation by the other stockholders, this court, in a complete opinion dealing with the subject matter, affirmed the decision of the tax court sustaining the Commissioner. We there held that where taxpayers in the same situation as the parties here borrowed money from the Buckeye corporation to purchase its corporate stock from the original holder, giving their promissory notes in return — the notes being later canceled upon surrender of part of the stock, with the stockholders retaining undiminished fractional interests in the corporation after completion of the transaction — cancellation of the notes was equivalent to distribution of dividends and therefore subject to income tax under the statute [26 U.S.C.A. § 115 (g)] imposing income tax when redemption of corporate stock occurs at such time and in such manner as to make consideration given by the corporation essentially equal to a dividend. Woodworth v. Commissioner of Internal Revenue, 6 Cir., 218 F.2d 719.

Upon the authority of and for the reasons stated in our opinion in the Wood-worth, case, supra, the decisions of the tax court in the instant cases are affirmed.

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PER CURIAM.

On this petition for review of decisions of the Tax Court of the United States, the petitioners are stockholders of the Buckeye Stamping Company who were not parties to the contest made by certain other stockholders of that company identically situated.

In the former litigation by the other stockholders, this court, in a complete opinion dealing with the subject matter, affirmed the decision of the tax court sustaining the Commissioner. We there held that where taxpayers in the same situation as the parties here borrowed money from the Buckeye corporation to purchase its corporate stock from the original holder, giving their promissory notes in return — the notes being later canceled upon surrender of part of the stock, with the stockholders retaining undiminished fractional interests in the corporation after completion of the transaction — cancellation of the notes was equivalent to distribution of dividends and therefore subject to income tax under the statute [26 U.S.C.A. § 115 (g)] imposing income tax when redemption of corporate stock occurs at such time and in such manner as to make consideration given by the corporation essentially equal to a dividend. Woodworth v. Commissioner of Internal Revenue, 6 Cir., 218 F.2d 719.

Upon the authority of and for the reasons stated in our opinion in the Wood-worth, case, supra, the decisions of the tax court in the instant cases are affirmed.

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248 F.2d 947, Counsel Stack Legal Research, https://law.counselstack.com/opinion/floyd-w-bell-v-commissioner-of-internal-revenue-ca6-1957.

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