522 F2d 981 Swank Son Inc v. United States

522 F.2d 981

75-2 USTC P 9675

SWANK & SON, INC., Plaintiff-Appellee,
v.
UNITED STATES of America, Defendant-Appellant.

No. 74-1131.

United States Court of Appeals,
Ninth Circuit.

Aug. 11, 1975.

Leonard J. Henzke, Jr., Atty. (argued), Tax Div., U. S. Dept. of Justice, Washington, D. C., for defendant-appellant.

Richard F. Gallagher (argued), Great Falls, Mont., for plaintiff-appellee.

OPINION

Before KOELSCH and DUNIWAY, Circuit Judges, and MURPHY,* District Judge.

PER CURIAM:

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1

The question on this appeal is whether the District Judge erred in concluding that the cash bonus received by Taxpayer, a small business corporation under Subchapter S of the Internal Revenue Code of 1954 (26 U.S.C. § 1371 Et seq.) and the lessor in an oil and gas lease, did not constitute "personal holding company income" under 26 U.S.C. § 1372(e)(5) as it read in 1965, and hence did not operate to terminate Taxpayer's election to be taxed as a small business corporation.

2

Having carefully considered the matter, we are convinced that the answer is "no" and approve and adopt the wellconsidered opinion of Judge Smith appearing in 362 F.Supp. 897 (D.Mont.1973).

3

Affirmed.

*

The Honorable Thomas F. Murphy, Senior United States District Judge for the Southern District of New York, sitting by designation