Glenn Hightower - Page 15

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                    c.   Whether Petitioner’s Opposition to the Buyout                
                         Precludes Taxation of the Payments in the Years              
                         the Payments Were Received                                   
               Petitioner contends that under the claim of right doctrine             
          the payments are not taxable to him in the years he received them           
          because he opposed the stock buyout, he established a separate,             
          interest-bearing account to hold the payments, and he did not use           
          the funds during the years in issue.                                        
               Contrary to petitioner’s contention, a payment properly made           
          to a taxpayer is includable in income in the year paid if, as               
          here, the taxpayer (a) receives and deposits the payment in an              
          unrestricted account, (b) seeks to invalidate the transaction or            
          circumstance which caused the payment to be made, and (c) has no            
          fixed obligation to pay the amount to another party.  Hope v.               
          Commissioner, 471 F.2d 738, 741-742 (3d Cir. 1973) (sale of stock           
          taxable in year of sale despite taxpayers’ efforts to rescind               
          stock sale in that year), affg. 55 T.C. 1020 (1971).  In                    
          addition, a taxpayer is taxable in the year the taxpayer receives           
          wages where the taxpayer tried to return the wages to her                   
          employer and the employer refused to accept repayment.  Miller v.           
          Commissioner, T.C. Memo. 1963-341, affd. without published                  
          opinion 15 AFTR 2d 321, 65 USTC par. 9,288 (9th Cir. 1965).  In             
          both of these cases, like the instant case, the taxpayer’s                  
          renunciation was not accepted by the other party.                           







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