UNITED STATES SUPREME COURT DECISIONS ON-LINE

Payments received by a corporation as a stockholder in another corporation, upon the latter's complete liquidation, are to be treated as payments upon a sale or exchange of the stock under § 23 (r)(1) of the Revenue Act of 1932, which allows the deduction of losses from sales or exchanges of stock, not held for more than two years, only to the extent of the gains from such sales or exchanges. P. 305 U. S. 295.

Section 23(f) provides that losses sustained by corporations during the taxable year shall be allowed as deductions in computing net income, subject to the limitations provided in subsection (r); subsection (r)(1) declares that losses from "sales or exchanges" of stock which are not "capital assets" (as defined in § 101, i.e., property held by the taxpayer for more than two years) shall be allowed only to the extent of the gains from such sales or exchanges. Sections 115 and 112 accord to losses on liquidation the same recognition accorded by § 23(r) to losses upon sales. Cf. White v. United States, ante, p. 305 U. S. 281. P. 305 U. S. 295.

97 F.2d 31 reversed.

Certiorari, post, p. 585, to review a judgment reversing an order of the Board of Tax Appeals, 35 B.T.A. 514, sustaining an additional income tax. clubjuris

Page 305 U. S. 294