Self Heating and Cooling, Inc., Transferee - Page 11

                                       - 11 -                                         
                              (A) Transferees.–-The liability, at                     
                              law or in equity, of a transferee                       
                              of property--                                           
                                   (i) of a taxpayer in the case                      
                                   of a tax imposed by subtitle A                     
                                   (relating to income taxes),                        
                    *    *     *        *      *       *      *                       
                    (b) Liability.–-Any liability referred to in                      
               subsection (a) may be either as to the amount of tax                   
               shown on a return or as to any deficiency or                           
               underpayment of any tax.                                               
               At the outset, it should be noted that “In proceedings                 
          before the Tax Court the burden of proof shall be upon the                  
          Secretary to show that a petitioner is liable as a transferee of            
          property of a taxpayer, but not to show that the taxpayer was               
          liable for the tax.”  Sec. 6902(a); see Rule 142(d).                        
               Whether and the extent to which a transferee is liable is              
          generally determined under State substantive law.  Commissioner             
          v. Stern, 357 U.S. 39, 45 (1958).  “The applicable State law is             
          determined by where the transfer occurred”.  Adams v.                       
          Commissioner, 70 T.C. 373, 390 (1978), supplemented by 70 T.C.              
          446 (1978), affd. without published opinion 688 F.2d 815 (2d Cir.           
          1982).  Since it is undisputed that the conveyance occurred in              
          Pennsylvania, we shall apply that State’s substantive law.                  
               “‘As a general rule,’ under Pennsylvania common law, ‘when             
          one company sells or transfers all its assets to another, the               
          successor company does not embrace the liabilities of the                   
          predecessor simply because it succeeded to the predecessor’s                

Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  Next

Last modified: May 25, 2011