William D. Gardner and Juanita Gardner v. Commissioner of Internal Revenue

613 F.2d 160, 45 A.F.T.R.2d (RIA) 570, 1980 U.S. App. LEXIS 21314

Opinions

ORDER

This is an appeal from the decision of the United States Tax Court determining a deficiency in federal income taxes for the taxable year 1970 in the amount of $10,-750.87. The opinion of the Tax. Court and its findings of fact are reported at P-H Memo T. C. par. 76,349 (1976).

Two issues have been presented on appeal, namely: (1) whether a $38,000 payment made by a corporation to a third person represented the discharge by the corporation of a personal obligation of its controlling stockholder William D. Gardner so as to constitute a constructive dividend to Gardner and (2) whether the value of the use of demonstrator automobiles owned and maintained by the corporation and used for personal purposes by the stockholder, his wife and minor son during the taxable year constituted dividend income to the stockholder.

In our opinion,, the findings of fact adopted by the Tax Court are supported by substantial evidence and are not clearly erroneous and its conclusions of law with respect to both, issues are correct.

We therefore affirm the decision of the Tax Court for the reasons set forth in its opinion written by Judge Scott.