In the case of Willcuts v. Bunn (1930), the U.S Supreme Court ruled on a matter concerning federal income tax law and its application to profits from stock sales. The respondent, Bunn, had sold shares in a corporation that he had received as dividends on his original investment in another company's preferred stock. He argued that these profits should be taxed at capital gains rates rather than ordinary income rates because they were derived from an increase in value of his initial investment over time. The court disagreed with this interpretation, ruling instead that such profits are taxable as dividend income under Section 201(g) of the Revenue Act of 1921 since they originated from corporate earnings and not solely due to appreciation in value of property owned by taxpayer. This decision clarified how certain types of financial transactions are classified for taxation purposes under federal law.

In the dissenting opinion for Willcuts v. Bunn, Justice Stone argued that the majority's interpretation of tax law was incorrect and unfair to taxpayers. He contended that dividends should not be taxed as income if they were derived from profits accumulated before the Revenue Act of 1916 came into effect. According to him, this act did not intend to impose a retroactive tax on such dividends but rather aimed at taxing future gains only. Therefore, he believed it was unjust for Mr. Bunn to pay taxes on his 1917 dividend which originated from pre-1916 profits of his company - a time when no federal income tax existed on corporate earnings or distributions thereof in form of dividends. In essence, Justice Stone’s dissent emphasized fairness and non-retroactivity principles in taxation matters.