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Rockefeller v. United States, 257 U.S. 176 (1921)
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General SummaryThis case is from a collection containing the full text of over 16,000 Supreme Court cases from 1793 to the present. The body of Supreme Court decisions are, effectively, the final interpretation of the Constitution. Only an amendment to the Constitution can permanently overturn an interpretation and this has happened only four times in American history.
Rockefeller v. United States, 257 U.S. 176 (1921)
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Rockefeller v. United States Nos. 535 , 536 Argued October 11, 12, 1921 Decided November 21, 1921 257 U.S. 176
ERROR TO THE DISTRICT COURT OF THE UNITED STATES
FOR THE SOUTHERN DISTRICT OF NEW YORK
Syllabus
1. Where the stockholders of a corporation, which is engaged in producing, buying, and selling crude petroleum and in transporting it through its pipelines, form a new corporation to which the pipeline property is conveyed by the old corporation and in consideration therefor and as part of the transaction all the capital stock of the new corporation, of par value equal to the valuation of the property so conveyed, is distributed among such stockholders pro rata, either by being issued to them directly or by being first issued to the old corporation and then so distributed, and the old company possesses such a surplus that the transaction leaves its capital unimpaired and requires no reduction of its outstanding issues, the shares so received by the stockholders are a dividend within the meaning of the Income Tax Act of October 3, 1913, c. 16, 38 Stat. 166, and income within the meaning of the Sixteenth Amendment. P. 182. United States v. Phellis, ante,156.
2. Such a distribution of shares, whatever its effect upon the aggregate interests of the stockholders, constitutes, in the case of each individual, a gain in the form of actual, exchangeable assets transferred to him from the old company for his separate use, in partial realization of his former indivisible and contingent interest in the corporate surplus -- in substance and effect a dividend of profits by the corporation, and individual income of the shareholder. P. 183.
274 F. 952 affirmed.
Error to judgments of the district court sustaining income tax assessments under the Income Tax Law of October 3, 1913, and the Sixteenth Amendment. In No. 535, the action was by the United States, to collect the tax, against the plaintiff in error Rockefeller. In No. 536, the plaintiffs in error, having paid the tax under protest, sued the collector to recover the amount with interest.
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Chicago: U.S. Supreme Court, "Syllabus," Rockefeller v. United States, 257 U.S. 176 (1921) in 257 U.S. 176 257 U.S. 177–257 U.S. 180. Original Sources, accessed November 22, 2024, http://originalsources.com/Document.aspx?DocID=7BYFQKMXGR18U9I.
MLA: U.S. Supreme Court. "Syllabus." Rockefeller v. United States, 257 U.S. 176 (1921), in 257 U.S. 176, pp. 257 U.S. 177–257 U.S. 180. Original Sources. 22 Nov. 2024. http://originalsources.com/Document.aspx?DocID=7BYFQKMXGR18U9I.
Harvard: U.S. Supreme Court, 'Syllabus' in Rockefeller v. United States, 257 U.S. 176 (1921). cited in 1921, 257 U.S. 176, pp.257 U.S. 177–257 U.S. 180. Original Sources, retrieved 22 November 2024, from http://originalsources.com/Document.aspx?DocID=7BYFQKMXGR18U9I.
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