- 55 - taxpayers’ part to completely terminate their ownership interest in AT&T. (3) The taxpayers could easily have changed their minds regarding their avowed intention to donate their preferred stock. (4) The taxpayers failed to show that their alleged decision to donate the preferred stock was in any way fixed or binding. This Court emphasized that a plan sufficient to pass muster under section 302(b)(3) did not need to be “in writing, absolutely binding, or communicated to others” but that “the above-mentioned factors, all of which are lacking here, tend to show a plan which is fixed and firm.” Id. at 291-292. Although the Court in Niedermeyer did not expressly state that the plan to which it was referring was a plan of the taxpayers, such a conclusion is warranted. The Court rejected the taxpayers’ self-serving testimony regarding their intention to donate and searched instead for objective evidence that the deemed section 304 redemption and the later gift were integrated parts of a firm and fixed plan on the part of the taxpayers to completely terminate their ownership interest; i.e., a plan consisting of clearly integrated steps to which the taxpayers were firmly committed. 3. Benjamin v. Commissioner In Benjamin v. Commissioner, 66 T.C. 1084 (1976), affd. 592 F.2d 1259 (5th Cir. 1979), the issue presented was whether thePage: Previous 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 Next
Last modified: May 25, 2011