Estate of Chandler v. Commissioner
United States Tax Court
22 T.C. 1158 (1954)
- Written by Heather Ryfa, JD
Facts
The estate of Charles Chandler, Margaret Chandler Bush, Helen Ott, John Bush, and Margaret Bush (collectively, the shareholders) (plaintiffs) were shareholders of a closely held corporation, Chandler-Singleton Company (company). The company operated a department store until 1946, when it sold all of its merchandise, fixtures, furniture, and lease to another company. The company then began operating a much smaller ladies’-wear store in a different location. The shareholders voted to authorize a partial liquidation because the company had cash in excess of that needed to operate the business. One-half of the company’s shares were redeemed pro rata in return for cash payment based on the book value of the shares. The shareholders reported the amount that exceeded their basis in the shares as capital gain. The Internal Revenue Service (defendant) assessed income taxes based on the determination that the redemption was instead a dividend taxable as ordinary income. The shareholders appealed these assessments to the United States Tax Court.
Rule of Law
Issue
Holding and Reasoning (Bruce, J.)
What to do next…
Here's why 810,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 46,300 briefs, keyed to 988 casebooks. Top-notch customer support.
- The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
- Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
- Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.
