Albert Gersten, Myron P. Beck and Ann H. Beck, Milton Gersten and Mary Gersten v. Commissioner of Internal Revenue

This appeal involves two questions. First, was the Tax Court correct in upholding the determination of the Commissioner that the contract rights distributed to stockholders had an ascertainable fair market value as of the date of the dissolution of a corporation? Second, was a taxpayer who was a resident of California, against whom a first wife had there obtained an interlocutory decree of divorce, and who had himself obtained a Mexican divorce from her and remarried the same day, entitled to file a joint income tax return with the second wife before the California divorce became final ?

As to the first question, the facts are summarized below. Albert Gersten and Myron Beck were the controlling stockholders of four corporations which were engaged in the business of subdividing tracts and constructing houses thereon and selling such houses. ' Milton Gersten was a stockholder in only two such corporations.

It was essential to the subdivision of the tracts acquired by these corporations and the sale of the houses to be constructed thereon that water facilities be provided therefor. San Gabriel Valley'Water Company, a water utility corporation of California, held a franchise to…