The opinion
This is an appeal from the determination of a deficiency of $946.74 in income taxes for the year 1919. The material allegations of the petition are admitted by the Commissioner. There was no appearance for the taxpayer at the hearing, and the appeal was submitted under Rule 18.
findings of fact.
The taxpayers are citizens of .Texas and reside at Denison.
During 1919 and for several years prior thereto, E. E. Davis owned 83% shares of the capital stock of a corporation named Davis Livery & Motor Co. This corporation had a total issued capital stock of $10,000 par value, held in equal parts by E. E. Davis and two others. The cost to Davis of the shares held by him was $3,333.33.
On December 31,1919, the corporation was dissolved and its assets and business were contemporaneously taken over by a partnership formed for the purpose by the three stockholders and a fourth person. At dissolution, the corporation had an earned surplus of $53,-445.65. After certain adjustments and deductions, the net value of the assets taken over by the partnership was ascertained to be $49,458.89. The distributive share thereof of E. E. Davis was $16,486.30.
The business formerly conducted by the corporation was thereafter continued by the partnership.
DECISION.
The determination of the Commissioner is approved. Appeal of E. C. Huffman, 1 B. T. A. 52; Appeal of John K. Greenwood, 1 B. T. A. 291; and Appeal of Estate of D. F. Buchmiller, 1 B. T. A. 380.