Rev. Rul. 69-561

M, a domestic corporation, purchased 10x shares of its outstanding capital stock for the purpose of holding it as treasury stock or retiring it. In acquiring its stock M incurred and paid brokerage fees.

Held, the brokerage fees are not ordinary and necessary business expenses, under section 162 of the Internal Revenue Code of 1954, and are not deductible from gross income. These expenditures are part of the purchase price of the stock so acquired. See Atzingen-Whitehouse Dairy, Inc. v. Commissioner, 36 T.C. 173 (1961).

O.D. 852, C.B. 4, 286 (1921), is hereby superseded, since the position stated therein is set forth under the current statute and regulations in this Revenue Ruling.

¹ Prepared pursuant to Rev. Proc. 67-6, C.B. 1967-1, 576.