The U.S. Supreme Court case Burnet, Commissioner of Internal Revenue v. Willingham Loan & Trust Company in 1930 revolved around the issue of tax liability for a corporation that had been dissolved and reorganized under a different name. The court ruled against the Willingham Loan & Trust Company, stating that it was liable to pay taxes on profits earned before its dissolution even though it had since reformed as another entity. This decision established an important precedent regarding corporate tax liabilities following restructuring or dissolution.

In the dissenting opinion for Burnet, Commissioner of Internal Revenue v. Willingham Loan & Trust Company, Justice Holmes argued that the majority's decision was based on a misinterpretation of tax law and its application to trusts. He contended that when income is assigned to a trust, it should be taxed at the trust level rather than being passed through to beneficiaries for taxation. The majority's ruling allowed double taxation: once at the corporate level and again when distributed as dividends - an outcome he believed Congress did not intend with its legislation. Furthermore, he disagreed with their interpretation of "income" in this context; while they considered it as any money received by a corporation or individual (including from sale of capital assets), Holmes viewed only profits from such sales as taxable income under existing laws. This distinction would have exempted much of what was taxed in this case.