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S.C. Johnson & Son, Inc. v. Commissioner, 63 T.C. 778 (1975), did
not end with a determination that the taxpayer did not have a
legal right to the appreciation in the currency contracts prior
to delivery of the British pounds on the maturity date. Indeed,
this Court, among other things, considered as significant the
fact that the taxpayer had not taken any steps to close out its
forward position under the sales contracts prior to the gift.
That inquiry would have been unnecessary if the issue as to
whether a taxpayer has a legally enforceable right to income is
dispositive of the anticipatory assignment of income analysis.
We, therefore, consider petitioners' argument as only one factor
in our inquiry to determine the reality and substance of the
events surrounding the merger agreement, the tender offer, and
the gifts to the Charities.
Petitioners contend that DC Acquisition was not legally
obligated to accept the tendered shares and proceed with the
merger until September 12, 1988, when DC Acquisition announced
its acceptance of the tendered shares. Petitioners characterize
DC Acquisition's right to proceed with the merger as an option in
light of the material change condition to the tender offer and
the occurrence of the fire that destroyed AHC's product
manufacturing plant on August 25, 1988. Petitioners assert that
DC Acquisition waived the material change condition for the first
time when it announced acceptance of the tendered shares.
The occurrence of the fire to AHC's product manufacturing
plant and the fact that DC Acquisition and CDI proceeded with the
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