Simmons v. Commissioner
This text of 3 B.T.A. 1360 (Simmons v. Commissioner) is published on Counsel Stack Legal Research, covering United States Board of Tax Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.
Opinion
FINDINGS OF FACT.
Warren H. Simmons, the decedent, died testate on April 15, 1922. Among other assets disposed of by will were 1,731 shares of the common stock of the Bemis Brothers Bag Co. of the par value of $100 per share.
The Bemis Brothers Bag Co. is a corporation engaged in the manufacture of bags from paper, cotton, jute, and other suitable materials. It has factories located at different points throughout the country. Its stock is rather closely held and is not listed on any stock exchange. It made no sales of stock in the year 1921, and, in the same year, only small amounts of the stock were sold by individual owners at prices not disclosed by the record.
During the year 1920 the Bemis Brothers Bag Co. sustained losses in the operation of its business in the amount of $23.34 for each share of outstanding common stock, and, in 1921, it earned a profit of $5.27 per share on such stock. It paid no dividends in 1921 and a 2 per cent dividend on January 31, 1922. Its balance sheet at December 31, 1921, was as follows:
Assets.
Current:
Cash_$2,203,243.94
Notes and accounts receivable_ 3, 029,389.88
Inventories__ 10>.640, 630.92
Stocks and bonds of other companies- 48, 658. 63
Cash and advances to affiliated companies_ 19, 396.12
Fixed:
Land and buildings_ 6, 544,106. 38
Machinery and tools_"- 3, 210, 785.79
Miscellaneous:
Unexpired insurance and other prepaid items_ 244, 875. 52'
Total. 25, 941, 087.18
[1361]*1361 Liabilities.
Current:
Notes "payable_$1,181, 062.50
Accounts payable_ 83, 230.42
Due to stockholders and employees_ 638,387.30
Reserves for taxes_ 226,459.38
Reserve pension fund_ 21,071.96
Three-year notes_i_ 650, 000.00
Fixed:
Common stock_ 11, 085,000.00
Preferred stock_ 1, 954, 900.00
Surplus_ 10,100,975.62
Total_ 25,941,087.18
The common stock of the Bemis Brothers Bag Co. had a fair market value of $150 a share at April 15,1922.
Order of redetermination will be entered on 15 days1 notice, wader Bule 50.
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3 B.T.A. 1360, 1926 BTA LEXIS 2420, Counsel Stack Legal Research, https://law.counselstack.com/opinion/simmons-v-commissioner-bta-1926.