- 14 - Commissioner v. P.G. Lake, Inc., 356 U.S. 260 (1958); (2) a situation where no sale or exchange occurred (such as a condemnation or taking), citing Commissioner v. Gillette Motor Transp., Inc., 364 U.S. 130 (1960); (3) a situation where a portion of the sale price of a debt instrument represents original issue discount, citing United States v. Midland-Ross Corp., 381 U.S. 54 (1965); and (4) the sale of a right to receive payment in return for a taxpayer’s personal services (petitioners provided no specific citation for this situation). Petitioners contend that their situation does not fit within those specific situations, and therefore the doctrine does not apply to them. Respondent, on the other hand, contends that the doctrine is a general principle that would apply to situations where the property in question involved “a claim or right to ordinary income.” Respondent, contrary to petitioners, contends that Arkansas Best did not obviate or limit that principle (as espoused in the above-referenced pre-Arkansas Best Supreme Court holdings). The Arkansas Best opinion is a major point of contention in the parties’ arguments. Petitioners contend that the Supreme Court, in attempting to clarify the interpretation of the term “capital asset” that had evolved from the holding in Corn Prods. Refining Co. v. Commissioner, 350 U.S. 46 (1955), decided that the five categories of property excluded from capital gainsPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Next
Last modified: May 25, 2011