Martin General Agency v. Commissioner

Review is sought of a decision of the Board of Tax Appeals which sustained a determination of respondent that there was a deficiency of $3,358.02 in income tax and a deficiency of $127.35 in excess profits tax paid by petitioner for the year 1934.

The question to be decided is whether, under §§ 23 and 117 of the Revenue Act of 1934, 48 Stat. 680 , 688, 714, 26 U.S.C.A. §§ 23 , 101, upon the liquidation of a corporation, a stockholder’s loss from its investment in its stock is deductible in full, or whether the deduction should be limited to $2,000.

The petitioner is a corporation incorporated under the laws of the State of Washington, with its principal office in that state. On or about March 3, 1928, the petitioner acquired by purchase the majority of the capital stock of the Washington Insurance Agency and subsequently, during 1928, acquired additional stock until *166 its total holdings thereof were 94 percent. At a meeting of the stockholders and directors of the Washington Insurance Agency on December 17, 1934, liquidation was formally authorized and thereafter, in the same year, its assets were sold for cash and the proceeds distributed to the stockholders. The cost to the…

(concurring in result).

' The facts in this case are so nearly like those in the case of Chester N. Weaver Co. v. Commissioner, 9 Cir., 97 F.2d 31 , that *167 upon the argument it was conceded that the determination of the case above referred to by the Supreme Court of the United States should be decisive of this case.

We are constrained to follow the decision of Helvering v. Chester N. Weaver Co., 59 S.Ct. 185 , 83 L.Ed.-, decided December 5, 1938, and, therefore, concur in the result arrived at in the foregoing opinion.