dissenting: I think that the result reached in this case is wrong and will be productive of mischief in the administration of the tax laws. There is no question that the dividends in controversy are taxable; the sole issue is when. The problem is one that perhaps could theoretically invite a variety of answers, but it was settled many years ago. The rule has been firmly established that dividends and interest are taxable during the year that they are unqualifiedly made available to the taxpayer. Avery v. Commissioner, 292 U. S. 210; Loose v. United States, 74 F. 2d 147 (C. A. 8); Regs. 111, sec. 29.42-3. It is a rule that is sound and provides certainty and stability in a field where such is highly to be desired.
Applying that rule to the stipulated facts of this case, it would seem that there could be only one answer. The stipulation explicitly states that “The dividends were unqualifiedly available to the demand of the petitioner in the event he personally appeared and demanded same on December 31, 1949.” Petitioner argues that as a practical matter it would have been impossible for him to appear on December 31, 1949, at each of the savings and loan associations, scattered over the entire country, and that therefore the dividends were not in fact unqualifiedly subject to his control at that time. However, it is clear that such circumstance is irrelevant, cf. Loose v. United States, supra, and the prevailing opinion does not profess to give any weight to it. If the point were sound, then the shareholder in a nearby savings and loan association would be charged with the dividend in the year of declaration, whereas another shareholder residing in a more remote area would account for his dividend in the following year. Or, a taxpayer having shares in nearby as well as remote associations might' be taxed in the earlier year with respect to dividends in the local associations but in the later year with respect to dividends declared by the distant ones. And, if such criteria are relevant, should it make a difference that the taxpayer is away from home on the crucial date and is within easy reach of one of the remote associations? Again, if the taxpayer should suffer a paralytic stroke thereby being disabled from presenting himself at any of the associations, would that fact be pertinent? It seems obvious that any test that turned on such considerations would be thoroughly unacceptable and contrary to the theory of the Loose case.
I can find no justification in the decisions or the regulations for the result reached by the majority. Certainly, nothing in the regulations, calls for the result. The test is plainly stated in the regulations as follows: “Dividends on corporate stock are subject to tax when un-qualifiedly made subject to the demand of the shareholder.” And here the stipulated facts disclose that time to be 1949. To be sure, the regulations go further and undertake to furnish a guide for determining when dividends become unqualifiedly subject to the shareholder’s demand. In the normal course, a dividend declared payable on December 31 and mailed by a corporation in accordance with its practice so that the shareholder would not receive it until January is not considered to have been unqualifiedly made subject to his demand prior to January. But here, the dividends were mailed merely as a convenience to the shareholder, cf. Frank W. Kunze, 19 T. C. 29, affirmed, 203 F. 2d 957 (C. A. 2), and the stipulation of facts itself tells us when the dividends were unqualifiedly available to him.
Moreover, the regulations further provide that: “An amount credited to shareholders of a building and loan association, when such credit passes without restriction to the shareholder, has a taxable status as income for the year of the credit.” Although it is true that we have here savings and loan associations rather than building and loan associations, it seems plain that the same result is required. It should be a matter of no moment whether there was technically a “credit” to the shareholder’s account, as stressed in the prevailing opinion; moreover, the record herein fails to show that there weren’t some comparable bookkeeping entries here. The pivotal inquiry is whether the dividends were unqualifiedly available to petitioner on December 31, 1949. I think that the stipulation of facts answers that question in the affirmative.
Opper and Tietjens, JJ., agree with this dissent.