Tribune Company, As Agent of and Successor By Merger to the Former the Times Mirror Company, Itself and its Consolidated Subsidiaries - Page 40

                                       - 127 -                                        
          result because reached by following a devious path.  * * *  The             
          controlling principle will be found in Gregory v. Helvering”.               
               Respondent also relies on another “reorganization” case,               
          West Coast Mktg. Corp. v. Commissioner, 46 T.C. 32 (1966), in               
          which the sole stockholder and president of the taxpayer                    
          corporation desired to dispose of certain land.  In order to                
          qualify the disposition as a tax-free reorganization under                  
          sections 354(a)(1) and 368(a)(1)(B), a corporation, Manatee, was            
          formed, and the subject land was transferred to Manatee in                  
          exchange for stock.  The stock of Manatee was then transferred to           
          the acquiring corporation in exchange for its stock.  Thereafter,           
          Manatee was liquidated.  Citing Minn. Tea Co. v. Helvering,                 
          supra, and Gregory v. Helvering, supra, this Court acknowledged             
          that the transaction fell literally within the reorganization               
          provisions but held that “the tax consequences must turn upon the           
          substance of the transaction rather than the form in which it was           
          cast.”  West Coast Mktg. Corp. v. Commissioner, supra at 40.                
          Respondent argues that MB Parent in the instant case is                     
          comparable to the intermediary corporation in West Coast Mktg.              
          Corp. in that it had no business, no offices, and no employees,             
          and it served no purpose other than to create the form necessary            
          to support a claim for tax-free reorganization treatment.                   
               In addition to cases cited above, respondent relies on the             
          legislative history of the reorganization provisions, various               






Page:  Previous  116  117  118  119  120  121  122  123  124  125  126  127  128  129  130  131  132  133  134  135  Next

Last modified: May 25, 2011