Estate of Stranahan v. Commissioner
case brief
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472 F.2d 867,1973 U.S. App. 73-1 U.S.
Tax Cas. (CCH) P9203; 31 A.F.T.R.2d (RIA) 710
CASE SYNOPSIS: The United States Tax
Court partially denied appellant estate's petition for a
redetermination of a deficiency in the decedent's income tax. The
estate sought review.
FACTS: A taxpayer needed to accelerate his income to take advantage of certain interest deductions. To this end he assigned to his son anticipated stock dividends from his company for which the son paid consideration. The company was instructed to issue future dividend checks to the son. When the dividends for the tax year in question were paid to the son appellee United States government attributed the dividends to appellant taxpayer's estate and assessed tax accordingly. The trial court partially denied appellant's petition for a redetermination of the deficiency in the deceased taxpayer's income tax and appellant sought review.
FACTS: A taxpayer needed to accelerate his income to take advantage of certain interest deductions. To this end he assigned to his son anticipated stock dividends from his company for which the son paid consideration. The company was instructed to issue future dividend checks to the son. When the dividends for the tax year in question were paid to the son appellee United States government attributed the dividends to appellant taxpayer's estate and assessed tax accordingly. The trial court partially denied appellant's petition for a redetermination of the deficiency in the deceased taxpayer's income tax and appellant sought review.
ANALYSIS:
The court reversed because the
transaction involving the sale of future dividends was valid and for
consideration. The taxpayer reported the money paid to him by his son
as income and the son likewise reported the dividend received as
income.
CONCLUSION: The court reversed the denial of appellant estate's petition for a redetermination of a deficiency in the decedent's income tax.
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CONCLUSION: The court reversed the denial of appellant estate's petition for a redetermination of a deficiency in the decedent's income tax.
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