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deemed to have held or owned those assets while they were used by
Button in the conduct of its business. Acro Manufacturing Co. v.
Commissioner, supra at 383. Respondent, while admitting that the
assets distributed to the taxpayer in connection with the section
332 liquidation of Button were not capital assets in Button’s
hands, argued that, because the former Button assets were never
used in the taxpayer’s business, they constituted capital assets
in the taxpayer’s hands. Id. at 384.
We rejected the taxpayer’s arguments and held that the
character of the Button assets did not automatically carry over
to the taxpayer; rather, we stated that our concern was with the
“tax nature” of those assets in the taxpayer’s hands. We asked:
“Were the assets acquired or used in connection with a business
of * * * [the taxpayer]?” Id. We found that the taxpayer
“neither acquired nor used the Button assets in its business,
neither did * * * [the taxpayer] enter into the button business.”
Id. at 386. In connection with those findings, we rejected the
taxpayer’s argument that it used the former button assets in its
business “for a short time”, between the same-day liquidation of
Button and sale of its assets, stating that “ownership for such a
minimal, transitory period is insufficient to establish ‘use’ of
the distributed assets in * * * [the taxpayer’s] business or to
place * * * [the taxpayer] in the button business.” Id. at 384.
As a result, we found that the former Button assets were capital
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