¶1dissenting: In substance, the majority opinion holds that the requirement in section 368(a)(1)(B) that the stock of the acquired corporation must be acquired solely for voting stock of the acquiring corporation is satisfied if at least 80 percent of the stock is so acquired, notwithstanding the remainder may have been acquired for cash. In so holding, the majority goes contrary to what has been the position of the respondent, acquiesced in by the tax bar, over the past 40 years. I find no support for — and considerable language inconsistent with — the majority’s opinion in the authorities cited therein. In fact, the majority reaches this view, not in reliance upon decided cases, but on the basis of a somewhat nebulous distinction of the facts in those cases. Accepting the validity of that distinction— which I do not — does not justify rewriting the law at this late date.
71 T.C. 727
Reeves v. Commissioner
Decided February 6, 1979
United States Tax Court · decided 1979-02-06
In 1968 and 1969, X corporation acquired approximately 8 percent of the stock of Y corporation from the latter's shareholders for cash. Held: as a matter of law, X corporation's prior cash purchases of Y corporation stock are irrelevant and the 1970 exchange satisfies the solely for * * * voting stock requirement of sec. 368(a)(1)(B), I.R.C. 1954.
Cited by 10 later decisions — most recently February 1986
4 federal appellate · 3 district ·
Good law ✅— No negative treatment on recordhow we know
Decisions will be entered for the petitioners · Decided 1979-02-06
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