For Your Data Clifton Inv. Co. V. Commissioner Illustration Brief
November 04, 2016
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Clifton Investment Company v. Commissioner representative brief
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312 F.2d 719, 1963 U.S. App. 63-1 U.S. Tax Cas. (CCH) P9246; eleven A.F.T.R.2d (RIA) 649
CASE SYNOPSIS: Petitioner challenged a determination from the the States Tax Court, which entered judgment inwards favor of respondent inwards a dispute over whether petitioner was entitled to the non-recognition of gain nether 26 U.S.C.S. § 1033(a)(3)(A).
FACTS: Petitioner, a existent estate investment corporation, sold a edifice to a urban heart rather than convey the urban heart practice its powers of eminent domain. The edifice inwards enquiry was a rental property. Petitioner used the funds it received to purchase a hotel. Petitioner contended that it was entitled to the non-recognition of gain nether § 1033(a)(3)(A) because the purchase of the hotel's stock was investment inwards holding of a "similar or related service or use." Respondent assessed a deficiency against petitioner. The taxation courtroom entered judgment inwards favor of respondent. On review, the courtroom determined that petitioner was non entitled to the benefits nether § 1033(a)(3)(A). The taxation courtroom used the functional exam to orbit upwards one's heed whether the properties were similar. The courtroom rejected the work of this test. The courtroom constitute that petitioner was required to convey a continuity of involvement inwards the master copy holding in addition to its replacement. The holding must convey been reasonably like inwards their relation to the taxpayer. The ultimate work of the holding was non determinative. Because the acquisition of the hotel altered petitioner's interest, it was non entitled to the taxation benefits of § 1033(a)(3)(A).
CONCLUSION: The courtroom affirmed the determination inwards favor of respondent inwards a dispute over whether petitioner was entitled to a non-recognition of gain.
FACTS: Petitioner, a existent estate investment corporation, sold a edifice to a urban heart rather than convey the urban heart practice its powers of eminent domain. The edifice inwards enquiry was a rental property. Petitioner used the funds it received to purchase a hotel. Petitioner contended that it was entitled to the non-recognition of gain nether § 1033(a)(3)(A) because the purchase of the hotel's stock was investment inwards holding of a "similar or related service or use." Respondent assessed a deficiency against petitioner. The taxation courtroom entered judgment inwards favor of respondent. On review, the courtroom determined that petitioner was non entitled to the benefits nether § 1033(a)(3)(A). The taxation courtroom used the functional exam to orbit upwards one's heed whether the properties were similar. The courtroom rejected the work of this test. The courtroom constitute that petitioner was required to convey a continuity of involvement inwards the master copy holding in addition to its replacement. The holding must convey been reasonably like inwards their relation to the taxpayer. The ultimate work of the holding was non determinative. Because the acquisition of the hotel altered petitioner's interest, it was non entitled to the taxation benefits of § 1033(a)(3)(A).
CONCLUSION: The courtroom affirmed the determination inwards favor of respondent inwards a dispute over whether petitioner was entitled to a non-recognition of gain.
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