
    Argued October 8,
    affirmed November 19,
    petition for rehearing denied December 16, 1969
    BURRELL et al, Respondents, v. STATE TAX COMMISSION, Appellant.
    
    460 P. 2d 1020
    
      Richard A. Uffelman, Assistant Attorney General, Salem, argued the cause for appellant. With him on the briefs were Robert T. Thornton, Attorney General and Carlisle B. Roberts, Assistant Attorney General, Salem.
    
      Bernard F. Bednarz, Salem, argued the cause and filed a brief for respondents.
    
      Before Perry, Chief Justice, and Sloan, O’Connell, Goodwin, Denegre and Holman, Justices.
   SLOAN, J.

In 1966, plaintiffs James Burrell and Robert Burrell were transacting business in Salem as a partnership. In the latter part of that year the partnership assets were transferred to a corporation formed by Burrells for the purpose of exchanging the stock in the corporation for all of the assets and liabilities of the partnership. It was stipulated that the transfer was a tax free exchange pursuant to both federal and state statutes. Section 351, Internal Revenue Code 1954 and ORS 316.281(4) and ORS 317.231(5). At the date of the transfer the partnership had a bad debt reserve which was transferred to the corporation. The tax commission required the partners to include in their income for that year, as individual income, the amount of the bad debt reserve. Plaintiffs appealed the commission’s decision to the tax court. The tax court reversed the commission and it appeals.

The tax court’s opinion, reported at 3 OTR Adv Sh 357, 1969, fully states the issues and the basis of its decision. We concur in that decision. It is unnecessary to repeat or add to the tax court’s opinion.

Affirmed.  