Rev. Rul. 60-328

In view of the decision in United States v. Anderson Clayton & Co. , 350 U.S. 55, Ct. D. 1788, C.B. 1955-2, 524, reconsideration has been given to G.C.M. 16651, C.B. XV-2, 130 (1936), with respect to the treatment afforded the acquisition and disposition by a corporation of its own capital stock (treasury stock) under section 39.22(a)-15 of Regulations 118.

G.C.M. 16651, supra , held that the gain derived by a corporation through the sale of its stock to its employees under a stock purchase plan, the stock having been acquired by the corporation in the open market to provide shares of stock for the plan, constitutes taxable income under section 22(a) of the Internal Revenue Code of 1939.

Under the provisions of section 1032(a) of the Internal Revenue Code of 1954, the issue involved in G.C.M. 16651, supra , and the Anderson Clayton & Co. , decision is made moot for taxable years beginning after December 31, 1953, and ending after August 16, 1954.

In the light of the decision in the Anderson Clayton & Co. , case, nonacquiescences in the following cases are withdrawn and acquiescences are substituted: Rollins Burdict Hunter Company v. Commissioner , 9 T.C. 169, nonacquiescence C.B. 1948-1, 4; Batten, Barton, Durstine & Osborn, Inc. v. Commissioner , 9 T.C. 448, nonacquiescence C.B. 1948-1, 4; H. W. Porter & Company v. Commissioner , 14 T.C. 307, nonacquiescence C.B. 1950-1, 7; The Timken-Detroit Axle Company v. Commissioner , 21 T.C. 769, nonacquiescence C.B. 1954-2, 6. See page 3, this Bulletin.

G.C.M. 16651, C.B. XV-2, 130 (1936), is revoked.