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Retention Of Control Over Stock Constitutes "Ownership" Under Section 1239 Of The Internal Revenue Code-Harry Trotz, Michigan Law Review
Retention Of Control Over Stock Constitutes "Ownership" Under Section 1239 Of The Internal Revenue Code-Harry Trotz, Michigan Law Review
Michigan Law Review
Petitioner set up a corporation, retaining seventy-nine per cent of the stock and -distributing the remainder to a third party. The third party borrowed from petitioner, pledging his stock as security and executing an option agreement under which the petitioner could recover the stock at any time. Subsequently, the newly organized corporation purchased all the depreciable assets of petitioner's proprietorship at a price in excess of their adjusted basis; petitioner reported the difference as a capital gain. The Commissioner declared a deficiency, relying on section 1239 of the Internal Revenue Code, which treats as ordinary income the gain recognized from …
Impact Of Recent Tax Stimulants On Modest Enterprises, L. Hart Wright, Jerome B. Libin
Impact Of Recent Tax Stimulants On Modest Enterprises, L. Hart Wright, Jerome B. Libin
Michigan Law Review
The recession year 1958 found Congress in a mood to "aid and encourage small business" through more favorable tax treatment. The thrust of the ensuing legislation touched in varying degrees the whole life span of a modest enterprise, from organization through liquidation. The focus here, however, will be confined to a consideration of the practical impact of the recent statutory changes on the organizational and ordinary operational phases of such a business.
Taxation - Federal Income Tax - Lessor's Right To Depreciation Allowances Under Long Term-Lease, E. Roger Frisch S.Ed.
Taxation - Federal Income Tax - Lessor's Right To Depreciation Allowances Under Long Term-Lease, E. Roger Frisch S.Ed.
Michigan Law Review
Plaintiff corporation leased its entire railroad property under a long-term lease subject to termination at the election of either party, or by breach of die lessee. The lessee agreed to preserve, replace, renew and maintain the property during the term and to return it upon termination "in at least as good condition as at the beginning of the term." Plaintiff, on the other hand, agreed to reimburse the lessee for all additions and betterments to the property which passed to him upon termination. The government disallowed plaintiff's claim for a tax refund based on its right to allow for depreciation, …
Taxation - Federal Income Tax - Renting Out A Single Home As A Trade Or Business For Purposes Of Capital Loss Carry-Over, Alice Austin S.Ed.
Taxation - Federal Income Tax - Renting Out A Single Home As A Trade Or Business For Purposes Of Capital Loss Carry-Over, Alice Austin S.Ed.
Michigan Law Review
Taxpayer, who was not in the real estate business and who was involved in only occasional real estate transactions, inherited a house which he rented out until he sold it at a loss. He treated the transaction as a capital loss, taking advantage of the capital loss carry-over provisions of the Internal Revenue Code. Deficiency assessments were levied against the taxpayer upon the theory that the loss sustained upon the sale of the house was an ordinary loss which could not be carried over to later years. Taxpayer paid the deficiency assessment and sued for a refund. The district court …
Taxation - Federal Income Tax - Consequences To Seller And Buyer Of Covenant Not To Compete, Richard B. Barnett S.Ed.
Taxation - Federal Income Tax - Consequences To Seller And Buyer Of Covenant Not To Compete, Richard B. Barnett S.Ed.
Michigan Law Review
The owners of the entire capital stock of a newspaper business received an offer of $1,000,000 for their stock and a covenant not to compete with buyers for ten years. After the offer was accepted and the contract of sale drawn up, buyer asked for a clause in the contract evaluating the covenant not to compete at $50 a share and the stock at $150 a share in order to help him taxwise. The clause was accepted with little discussion. The sellers reported the entire proceeds of the sale on their income tax returns as long term capital gain, but …
Taxation-Federal Income Tax-Gain On Sale Of Livestock, David F. Ulmer S.Ed.
Taxation-Federal Income Tax-Gain On Sale Of Livestock, David F. Ulmer S.Ed.
Michigan Law Review
Taxpayer was engaged in the business of raising and breeding beef cattle. Each year he would add to the breeding herd the young females raised the previous year and would cull from the herd those older cows who had outlived their most productive years and such young heifers as had proved unproductive. These culls were sold on the market, and taxpayer returned the amounts received from these sales as capital asset gain. The Commissioner assessed a deficiency claiming the sales resulted in ordinary income. Held, the sale of culls from a breeding herd is treated as a sale of …
Taxation - Income Taxes - Deduction For Uncompensated Damages To Non-Business Property, Anthony L. Dividio
Taxation - Income Taxes - Deduction For Uncompensated Damages To Non-Business Property, Anthony L. Dividio
Michigan Law Review
Several years prior to 1934, the taxpayer purchased a pleasure automobile for $1,825. Its value in 1934 was $225; after a collision its value was $190. The Circuit Court of Appeals for the Second Circuit upheld the taxpayer's contention that inasmuch as a taxpayer is not allowed an annual deduction for depreciation on non-business property, the original cost of such property constituted the basis for measuring the "uncompensated loss" allowed as a deduction for income tax purposes under section 113 (b) (1) (B) of the Revenue Act of 1934. Held, the decision of the Circuit Court of Appeals should …
Taxation - Real Property Assessment, Wayne E. Bahler
Taxation - Real Property Assessment, Wayne E. Bahler
Michigan Law Review
Based upon the cost-depreciation method applicable to adjacent property, the assessment of the Detroit-Windsor tunnel and terminal resulted in taxes equal to forty-one per cent of the gross revenue for the depression years of 1931-1934; The federal district court enjoined the collection of such amount, and assessed the property by the capitalized income method (seven per cent) plus $3,500 for the value of possible future increased earnings. Upon appeal it was held that the injunction on the original levy be affirmed since the cost-depreciation method was erroneous and offensive to the Fourteenth Amendment in not taking account of depressions or …
Goodwill And Other Nondepreciable And Depreciable Intangible Property As Invested Capital, Frederick Thulin
Goodwill And Other Nondepreciable And Depreciable Intangible Property As Invested Capital, Frederick Thulin
Michigan Law Review
The subject of intangible property under the federal tax laws is somewhat misunderstood. Many errors of an important nature have undoubtedly been made in reference thereto. The purpose of this paper is to point out the situations as they often exist and to give practical suggestions as to how to handle them insofar as authorized by the law and the treasury decisions and regulations.