DocketNumber： Docket No. 6058-82
Citation Numbers： 90 T.C. 1207, 1988 U.S. Tax Ct. LEXIS 76, 90 T.C. No. 78
Judges： Wright,Nims,Shields,Cohen,Swift,Jacobs,Parr,Wells,Whalen,Gerber,Ruwe,Chabot,Whitaker,Korner,Hamblen,Clapp,Gerber
Filed Date： 6/21/1988
Status： Precedential
Modified Date： 1/13/2023
*76
P, a DISC, was organized and operated in reliance upon the handbook, a guidebook for DISC's issued by the Department of the Treasury. P held no property, had neither employees nor place of business, and conducted no activity beyond those steps necessary to ensure qualification as a DISC. R sent a statutory notice of deficiency to P in which R determined that P failed to qualify as a DISC for taxable years 1976 and 1977 on the ground that a commission payment was not made within the 60-day period allowed by regulation.
*1207 By notice of deficiency dated December 15, 1981, respondent determined deficiencies in petitioner's Federal income taxes for the taxable years 1976 and 1977 in the amounts of $ 1,100,583 and $ 1,170,603, respectively.
After concessions by the parties, the issues for our decision are (1) whether petitioner Addison International, Inc., failed to qualify as a Domestic International Sales *1208 Corporation (DISC) under
FINDINGS OF FACT
Some of the facts have been stipulated and are so found. The stipulated facts and attached exhibits are incorporated herein by this reference.
Petitioner Addison International, *78 Inc. (AI), was incorporated on September 21, 1973, under the laws of the State of Michigan as a Domestic International Sales Corporation (DISC) pursuant to
APC manufactures heating and air-conditioning equipment for commercial and residential use. At the time of trial, APC had its primary manufacturing plant in Addison, Michigan, *79 and additional facilities in Michigan and in Texas. Initially, APC sold heating and air-conditioning equipment exclusively in domestic markets. Using the Original Equipment Manufacturing (OEM) method, APC would sell its product to a retailing company which was usually a major manufacturing company with brand-name recognition. In addition to selling its own manufactured products, the retailer would affix its own brand-name to the APC product for sale. Neither the names "Addison" nor "APC" achieved name-brand recognition because the products manufactured by APC did not carry either name. Furthermore, under the OEM method of selling, APC saved costs by not having to maintain a retail or distribution network.
*1209 In the mid-1960's, APC began exporting its products overseas. When it commenced its export operations, APC did not use the OEM method of selling; instead, its products were exported under its own name through the sales management firm of J.D. Marshall International (Marshall). Marshall purchased the products from APC and exported them independently. Although Marshall was not APC's agent, Marshall was granted an exclusive right to sell APC products bearing the Addison*80 name on the retail level in the overseas market. The products proved very marketable and successful, particularly with respect to the sales of air-conditioners in the Middle East.
In 1964 or 1965, APC expanded its export activities and began exporting products under the OEM method. APC sold its products to name-brand retailers who in turn sold the APC products overseas under their own names and labels. Often these export retailers were the same companies or individuals who purchased APC products for domestic resale. Although APC was selling its products to both Marshall and to Marshall's competitors, the name-brand retailers, during this period, there was no conflict because the products prepared for OEM resale were cosmetically and superficially altered to satisfy the retailer's specifications. Under both arrangements, the export of APC products proved highly successful.
In September 1973, as a result of information learned at a seminar, APC organized and incorporated AI as a DISC. On the certificate of incorporation AI's sole purpose was listed as "any activity permitted to be carried on by a Domestic International Sales Corporation." Donald L. Ball (Ball) who was vice president*81 and treasurer for APC during the years in issue, stated that APC's sale reason for incorporating AI was to receive the tax-[ILLEGIBLE WORD] benefits available to a DISC. According to Ball, there were no additional economic considerations for such action.
On October 1, 1973, APC and AI executed an agreement pursuant to which AI promised that it would conduct its business at all times in such a fashion as to ensure its status as a DISC. In return, APC granted a franchise to AI with respect to all qualified export property sold for use outside of the United States and Puerto Rico. APC agreed to *1210 be responsible for the solicitation and satisfaction of orders. APC agreed to pay AI the maximum amount allowable as a commission, occasionally in advance. Such commissions were to be determined and paid within 8 months of the end of each accounting period. 2
*82 On November 30, 1973, AI elected DISC status, and APC simultaneously filed its consent to the election. For all taxable years subsequent to this election, including taxable years 1976 and 1977, AI reported income by filing Forms 1120-DISC, the income tax return for DISC's.
Throughout 1976 and 1977, AI maintained a separate bank account at the Detroit Bank & Trust Co. and kept books and records. The books and records consisted of a cash journal, a general journal, and a general ledger. AI had no employees, and maintained no office or facilities separate from those owned by APC. The officers of AI were V.C. Knight (Knight) as president, Ball as vice president and treasurer, Fred W. Freeman (Freeman) as secretary in 1976, and John Coyne (Coyne) as secretary in 1977. The board of directors consisted of Knight, Freeman, and Ball in 1976, and Knight, Coyne, and Ball in 1977. During this period Knight, Coyne, and Ball also served as officers of APC. In all matters relating to the organization and operation of AI, the officers and directors were guided by the "DISC-Handbook for Exporters" (the handbook) which was issued by the Treasury Department in January of 1972. This handbook *83 explained how to handle the affairs of the DISC in such a way as to ensure DISC qualification.
After incorporating AI, APC made no changes in its routine business conduct. APC continued to sell to brand-name retailers and to Marshall. Robert E. Dyas (Dyas), who was vice president of appliance and export sales during the years in issue, explained that after the incorporation of AI, business continued as usual. Indeed, AI had "absolutely no bearing on" the manufacturing department, of which Dyas was in control. AI had no assets and no employees. Except for services relating to qualification, AI performed no services for APC or anyone else, nor did AI request the *1211 performance of services from APC or anyone else. AI did not ship goods under its own name and did not issue documents of title or invoices. However, AI's shareholders and officers did hold annual meetings.
During taxable years 1976 and 1977, AI computed income under the methods prescribed by
Although APC claimed commission expense deductions attributable to commissions payable to AI for taxable years 1976 and 1977 in the amounts of $ 2,189,746 and $ 2,313,141, respectively, the money was not actually paid by the close of AI's taxable year. On October 19, 1977, APC issued a check to AI in payment of the commission owing for the taxable year 1976. The payment was made at this time *1212 because it was APC's practice to pay AI at or about the time the DISC tax returns were filed. 3 The next day, AI made a producer's loan to APC in the amount of $ 1,141,400. 4 The remainder of the commission payment, in the amount of $ 1,048,346, was distributed by AI to APC as previously taxed income. On March 21, 1978, APC issued a check in the amount of $ 2,324,840 to AI in payment of the commissions and interest owing for the taxable year 1977. Of this amount, AI made an advance payment for a producer's loan to APC in the amount of $ 979,112, and made a distribution*86 of the remainder to APC in the amount of $ 1,345,728. AI's only other expenditures for taxable years 1976 and 1977 were payments for Michigan franchise taxes in the amounts of $ 5,456 and $ 10, respectively.
In March 1978, independent auditors informed APC's officers and directors that they had failed to follow one of the procedures required to qualify AI as a DISC. Specifically, the memorandum advised that
The statute of limitations with respect to APC was extended for the taxable years 1976 and 1977 to June 30, 1982, pursuant to written agreement. The statute of limitations with respect*88 to APC for taxable years 1976 and 1977 *1213 expired at midnight on June 30, 1982. Respondent issued a timely notice of deficiency to AI for taxable years 1976 and 1977 on December 15, 1981.
OPINION
In his notice of deficiency to AI, respondent determined that the commissions receivable reported by AI in the taxable years 1976 and 1977 did not constitute qualified export assets because those amounts had not been paid by APC to AI within 60 days after the close of each taxable year. Respondent therefore determined that AI did not qualify as a DISC under section 992 in the taxable years 1976 and 1977. Respondent allocated the income and expenses to AI, itself, rather than to APC.
Petitioner contends that the regulations containing the 60-day payment rule are invalid but that, if they are valid, retroactive application of the regulations in this case would be improper. In the alternative, petitioner argues that it substantially complied with the regulations. With respect to the second issue for our consideration, petitioner contends that if AI is not qualified as a DISC for the taxable years 1976 and 1977 then the taxable income is properly taxable to APC rather than AI. Petitioner*89 bears the burden of proof on all issues.
The DISC provisions were enacted by Congress in 1971 6 to provide tax deferral for that portion of income earned by U.S. corporations from the sale or lease of domestic products to foreign buyers and lessees. Generally, a corporation that qualifies as a DISC is not taxable on its profits.
In order to qualify as a DISC, at least 95 percent of the adjusted basis of all assets of the corporation, measured on the last day of the taxable year, must be qualified export assets. Sec. 992(a)(1)(B);
*92 *1215 Since APC was a related supplier with respect to AI, AI's commissions receivable from APC had to be paid within 60 days following the close of AI's taxable year in order for such commissions receivable to constitute trade receivables and, accordingly, qualified export assets, under
Petitioner first argues that the regulations imposing the 60-day payment rules are invalid. Petitioner maintains that the regulations are interpretive, rather than legislative regulations, and, as such, they exceed the scope of the Secretary's authority under section 7805. This very question has been considered*93 on several prior occasions and the regulations have consistently been upheld as representing a proper exercise of the Secretary's authority.
Petitioner next contends that, even if the regulations which contain the 60-day payment rules are valid, the regulations may not be retroactively applied to it.
Petitioner argues that because it relied on promises contained in the handbook, *95 the regulations cannot, in fairness, be retroactively applied to it. Specifically, petitioner relied on the section of the handbook which stated that "The Internal Revenue Service will follow the rules and procedures set forth in this part until such time as they may be modified in regulations or other Treasury publications. Any such modifications which may be adverse to taxpayers will apply prospectively only." "DISC: A Handbook for Exporters," U.S. Department of the Treasury, January 1972, at 10. Because the handbook clearly promised that adverse treatment would not be retroactively applied, petitioner maintains that its reliance on the handbook immunizes it from retroactive application.
We may quickly dispense with petitioner's argument with respect to taxable year 1977. Both regulations had been fully promulgated in final form by October 14, 1977, but APC's payment to petitioner did not occur until March 28, 1978. As a calendar year taxpayer, petitioner's taxable year ended December 31, 1977. AI should have made the payment by March 1, 1978, in order to comply with the 60-day payment rule contained in the regulations. Surely *1217 petitioner did not believe that the*96 regulations, once fully and finally promulgated, would not have prospective application. Although the evidence shows that petitioner was unaware of the final promulgation, petitioner would have us allow it immunity against the effect of the regulations until such time as it actually learned of their promulgation in final form. This we cannot do, and find petitioner's argument concerning the retroactive application of the regulations with respect to taxable year 1977, unfounded.
With respect to the retroactive application of the 60-day-payment rule for taxable year 1976, petitioner has raised a question which has caused disagreement among the Circuit Courts of Appeals. In
In contrast, the U.S. Court of Appeals for the Second Circuit held, in a factually similar case, that the regulations could not be retroactively applied.
In
This Court has not directly addressed this question since the controversy arose in the Circuit Courts of Appeals. In
*99 In considering the arguments with respect to the retroactive application of
The Seventh Circuit and the Second Circuit both base their decisions to deny retroactive application on the narrow grounds of the singular and unusual nature of the DISC. Because the entire purpose of the DISC legislation was to entice taxpayers into following a path of behavior which satisfied the congressional objective of increasing U.S. exports, taxpayer compliance with the handbook implicitly served congressional objectives. The handbook promised the taxpayers that any modifications would be prospective, and many taxpayers relied on that. As the Seventh Circuit noted, regulations are subject to change, even substantial change, prior to final promulgation. Strict compliance with proposed regulations could cause extra time and labor if the proposed regulations*100 undergo substantial modification upon final promulgation. In the uncharted sea of structuring and operating a DISC, taxpayers who followed the guidelines in the handbook were adhering to the most reliable information *1219 available. Because the DISC is a creature of statutory artifice, a taxpayer would have no independent reasons for any actions taken with respect to the organization and operation of a DISC. Thus, we conclude that the positions taken by the Second and the Seventh Circuits are well founded. When sections of the Internal Revenue Code are designed to invoke taxpayers to follow a course of behavior for which they have no other motives, respondent cannot, in fairness, complain when the desired compliance is forthcoming and the taxpayers take the Commissioner at his word.
Petitioner did not maintain that the commission payment made by APC to AI on October 19, 1977, was motivated by the discovery that the regulations had been promulgated in final form. Although payment was made within 5 days of the promulgation, the timing was purely coincidental. Nonetheless, even if petitioner had been aware of the final promulgation of the regulations, it would not have expected*101 that they affected it, because it believed it was protected according to the promises contained in the handbook. While we cannot condone willful ignorance, we conclude that petitioner's failure to comply with the 60-day payment rule stemmed from its reliance on the handbook. Accordingly,
Petitioner's next argument is that the payments, although late, were sufficiently timely to constitute substantial compliance with the regulations in issue. This argument has been considered and rejected on several occasions.
*102 The second issue for our consideration is whether AI is properly taxable on the income which results from AI's disqualification as a DISC in taxable year 1977. In his notice *1220 of deficiency to AI, respondent determined that AI did not qualify as a DISC under section 992 for the taxable years 1976 and 1977. Respondent allocated the income and expenses to AI rather than to APC.
Although neither party discussed this issue extensively on brief, it appears that the statutory notice of deficiency was sent to AI, alone, and APC did not receive a notice of deficiency. Furthermore, with respect to APC, the statute of limitations has run and respondent is precluded from sending a notice of deficiency to APC. Respondent urges us to hold AI liable for the deficiency which results from its disqualification.
Petitioner argues that, if AI is disqualified as a DISC, then AI's current income should be taxed to APC rather than AI. In support of this position, petitioner stresses the total absence of economic purpose or activity behind AI's incorporation and operation. Although income was entered on AI's books and reported on AI's DISC income tax returns, petitioner maintains that this*103 was done purely to comply with the directives of the DISC legislation. Petitioner also contends that the assignment of income doctrine, articulated in
Petitioner argues that the principles of
Respondent counters that AI earned the income which was attributed to it on its books and ledgers. Respondent also argues that petitioner chose the corporate form and should be bound by that election. Because petitioner elected the DISC*105 form, respondent maintains, all of AI's activities were imbued with that business purpose and thus cannot be disregarded under
In the abstract, petitioner's argument is not without appeal. A DISC such as AI does not generate the income which it enters on its books. As is noted in the regulations under section 992, a DISC might not be recognized as a corporation for tax purposes if it were not a DISC.
The regulations distinguish between three different types of DISC income. A DISC can have "previously taxed income," "accumulated income," and "other*106 earnings and profits."
*1222 Upon disqualification, the DISC becomes a "former DISC." A DISC remains a former DISC for 5 years based on its original election, but if it fails to requalify as a DISC by the end of that 5-year period, the election expires.
The proper tax treatment of the third category of*107 DISC income, other earnings and profits, is less clear. Especially with respect to income received by a DISC which is subject to a valid DISC election but which has been disqualified, an initial analysis indicates that the underlying benefit accorded to DISC's and their shareholders is the deferral of the income which is ultimately taxable to the shareholders. Thus, at first blush it seems that disqualification would eliminate the benefit, ending deferral and making the shareholder immediately taxable on the DISC's current earnings.
However, the legislative history contains a brief reference which indicates that congressional intent dictates an opposite conclusion. Although other earnings and profits would appear to be generally comprised of income earned prior to DISC qualification, the Senate Finance Committee report noted that:
The third division of a DISC's earnings and profits, is referred to as "other earnings and profits." This has reference to those earnings and profits of a DISC which were accumulated while the corporation was not taxed as a DISC (i.e., in a year prior to the corporation's election, or subsequent to the election if it did not qualify for the year). These*108 are the "normal" earnings and profits of a DISC which are the same as the earnings and profits of an ordinary corporation which never was a DISC. As a result, these earnings and profits when distributed are eligible for the dividends received deduction and are not treated as foreign source income. [S. Rept. 92-437, at 122-123 (1972),
Thus, the legislative history indicates that the disqualified DISC was meant to be taxed as a separate corporation within the meaning of subchapter C on any income which *1223 was neither previously taxed income nor accumulated income. Although this aspect of Congress' framework for DISC taxation does not appear in the statute or the regulations, we shall accord it the proper weight. See
Accordingly, we find that the notice of deficiency was properly sent to the proper taxpayer, *109 AI, and that AI is liable for the deficiency determined with respect to taxable year 1977 only.
To reflect the foregoing,
Gerber,
All courts which have considered the final regulations in question have found them to be valid and "consistent with *1224 the statutes' origin and purpose."
Judge Simpson, in his thorough analysis of the retroactivity of regulations, set forth the following three principles (each of which was, at the very least, supported by a Supreme Court citation), as follows: (1) "Internal Revenue regulations are retroactive in effect unless the Commissioner provides otherwise." (2) "The Commissioner's failure to make regulations nonretroactive may not be disturbed unless it amounts to an abuse of discretion." (3) "An abuse of discretion may be found if the retroactive regulations alter settled prior law or policy upon which the taxpayer justifiably relied and if the change causes the taxpayer to suffer inordinate harm."
Our Court and the Court of Appeals for the 11th Circuit considered two bases in deciding whether the situation involved herein presented an exception to the general rule that regulations are to be retroactively applied. First considered was the principle that statements contained in publications, such as the handbook in question, do not bind the Commissioner in subsequent litigation. See cases cited at
*112 The second basis presents a more persuasive rationale for finding that the general rule of regulation retroactivity should apply. The handbook containing the guidelines or, *1225 lack of same, was published and issued by the Treasury Department during January 1972. "The handbook provided that its rules would be followed until modified 'in regulations or other Treasury publications.'"
In our finding that petitioner in
Our reasoning in support of retroactive application in
The opinions of the Courts of Appeals for the Second and Seventh Circuits which overruled memorandum opinions of this Court and supported a position contrary to the Court of Appeals for the 11th Circuit and this Court, essentially, offered the following reasoning: (1) That the handbook in question was something more than a statement of current law, because it contained promises to be relied upon in the future; and (2) that proposed regulations are merely "suggestions made for comment" and are not intended to modify anything.
Although I agree that proposed regulations do not have the authority or standing of temporary or final regulations, they are regularly used to present the Treasury Department's position on a particular subject. The purpose for issuing proposed regulations is to put taxpayers on notice and to elicit commentary that may be considered in finalizing the regulation. See sec. 601.601(a) and (b), Procedural Regs. As jurists, we have adhered to the principle that respondent's revenue rulings and procedures are nothing more than the position of a party and they are afforded little or no weight as authority.
*1227 To reiterate, in effect, the Government made no promises to this petitioner or any taxpayer with a taxable year after 1972. The handbook and proposed regulations were published within 9 months of each other during 1972. I find the majority's position that a proposed regulation is insufficient to put the public on notice to be simply incorrect.
For the foregoing reasons, I respectfully dissent from the majority's opinion.
Ruwe,
The majority opinion is based on a concern that were we to find petitioner totally lacking in substance, this "would, in effect, be calling a DISC a sham corporation" *117 and thus undermine the purpose of the DISC legislation. Majority opinion at p. 1221. We need not be concerned with undermining the purpose of the DISC legislation in this case for the simple reason that petitioner was not a DISC during 1977.
The majority opinion implies that even though petitioner was disqualified, it was still a DISC for some purposes. Sec. 992(a)(1) defines a DISC. Petitioner failed to meet the qualifications for DISC status which are contained in section 992(a)(1)(B) and section 993(b) and the regulations thereunder. This is undisputed. Section 992(a)(3) defines a "former DISC" as "with respect to any taxable year, a corporation
*1228 It is true that once having made an election to be treated as a DISC, a corporation that fails to qualify as a DISC for a particular year will be considered as a DISC for subsequent years in which it meets DISC qualifications. There is no need to make another election. See
*119 The DISC legislative history quoted on page 1222 of the majority opinion is consistent with the above analysis. It is unquestioned that a corporate entity that is a DISC or former DISC can have "'normal' earnings and profits * * * which are the same as the earnings and profits of an ordinary corporation which never was a DISC." S. Rept. 92-437, at 123 (1972),
*1229 Having eliminated the problem of potentially undermining the DISC statutory framework, this transaction should be judged on the basis of the facts presented. Petitioner contends that, in reality, it had no income because it did nothing to earn the income. Indeed, it could not have done anything based upon the findings of fact since it had no employees, performed no services, dealt with no customers, and did not even receive the payment of the amounts of income, which respondent argues it earned, until the following year. 2
*121 Normally, the choice of doing business in corporate form will be respected.
Whether the purpose be to gain an advantage under the law of the state of incorporation or to avoid or to comply with the demands of creditors or to serve the creator's personal or undisclosed convenience,
However, tax avoidance, standing alone, is not sufficient to meet the business purpose test in
*123 Having failed to qualify as a DISC, the only purpose for petitioner's existence, i.e., tax deferral, became impossible. Petitioner had no other business purpose and no business activity during the year 1977. To the extent that it received funds, it served as a conduit of the income earned by APC. As a mere conduit, petitioner was essentially acting as an agent for APC. Under the principles set forth in
This is not a case where we need be concerned with the equities of allowing a taxpayer to unfairly avoid taxation under a form which it chose. *124 It is clear that APC formed petitioner solely to take advantage of the DISC provisions, but for which there would have been no tax advantages under the facts of this case. When respondent determined that petitioner was not qualified as a DISC, the statute of limitations was still open with respect to APC and respondent had the knowledge and ability to totally disregard this purely tax-motivated transaction. 5 Instead, respondent chose form over substance. This should not be allowed in a situation where a taxpayer fails to meet highly technical provisions of a statutory scheme that was intended to encourage and benefit taxpayers who engaged in exporting activities. 6
*125
*. This opinion was reviewed by the Court prior to Chief Judge Sterrett's resignation from the Court.↩
1. Unless otherwise indicated, all section references are to the Internal Revenue Code of 1954 as amended and in effect during the years in issue, and all Rule references are to the Tax Court Rules of Practice and Procedure.↩
2. On Dec. 28, 1979, APC and AI entered into a subsequent franchise agreement which amended certain aspects of the initial franchise agreement. However, the alterations were minor and do not concern the taxable years in issue here.↩
3. Under sec. 6072(b), a DISC's tax return is due on or before the 15th day of the ninth month following the close of its taxable year.↩
4. The parties have stipulated that the producer's loan of Oct. 20, 1977, was not, in its entirety, a qualified producer's loan. Of that amount, only $ 634,299 was a qualified producer's loan, and the balance, in the amount of $ 507,101, did not qualify as a producer's loan.↩
5. Oct. 19, 1977, the actual date of the commission payment for the taxable year 1976, was more than 7 months after the date when payment should have been made in order to comply with the 60-day payment rule. The due date was Mar. 1, 1977. When APC made the payment, it included a portion labeled "interest accruing" for this 7-month extension.↩
6. Secs. 501-507 of the Revenue Act of 1971, Pub. L. 92-178, 85 Stat. 497, 535-553.↩
7. The parties agree that AI is a commission DISC rather than a buy-sell DISC.↩
8. The pertinent provisions of
(2)
(i) The amount * * * a sales commission (or reasonable estimate thereof) actually charged by a DISC to a related supplier * * * must be paid no later than 60 days following the close of the taxable year of the DISC during which the transaction occurred.↩
9. Where taxpayers rely on a plausible interpretation of the plain meaning of settled law "We see no reason to add to this burden by requiring them anticipatorily to interpret ambiguities in respondent's rulings to conform to his subsequent clarifications."
10. In
11. See also
12. Respondent maintains that sec. 482 is a tool which only he may wield, but this argument is misplaced because petitioner urges us to consider the source of AI's income under the case law doctrine of assignment of income rather than under the statutory authority of sec. 482. * This opinion was reviewed by the Court prior to Chief Judge Sterrett↩'s resignation from the Court.
1. Although one might make that argument, it is a matter of judgment and would appear to be a close call. In this regard, we have already taken a position on this aspect in
1.
2. Even the amount which petitioner received in March 1978, ostensibly due to commissions earned in 1977, was immediately paid back to APC in the form of an advance payment on a producer's loan and a distribution of previously taxed income on the assumption that petitioner qualified as a DISC. Since these characterizations of amounts petitioner paid back to APC depend on petitioner's DISC qualification, they must be disregarded. It is then clear that petitioner was merely a conduit.↩
3. The majority suggests that because petitioner maintained a bank account, kept books and records, and held annual meetings, it must be recognized as a corporation for Federal income tax purposes under
4. If we were to recognize petitioner as the bona fide recipient of sales commissions which are really a portion of APC's profits, we would also be violating the principle that income must be taxed to the person or entity that earned it.
5. The majority does not, and could not, apply principles of equitable estoppel given the facts in this case. See
6. In similar cases respondent has disallowed the parent's commission expense or reallocated the former DISC's "income" back to the parent under sec. 482. It is possible that respondent will now feel free to choose whichever alternative produces the most tax.↩
Cwt Farms, Inc. And Cwt International, Inc. v. Commissioner ... , 755 F.2d 790 ( 1985 )
Lecroy Research Systems Corporation v. Commissioner of ... , 751 F.2d 123 ( 1984 )
Edgar B. Sims v. United States , 252 F.2d 434 ( 1958 )
The Estate of Grace E. Lang, Deceased. Richard E. Lang v. ... , 613 F.2d 770 ( 1980 )
Stubbs, Overbeck & Associates, Inc. v. United States , 445 F.2d 1142 ( 1971 )
Gehl Company v. Commissioner of Internal Revenue , 795 F.2d 1324 ( 1986 )
Lucas v. Earl , 50 S. Ct. 241 ( 1930 )
Burnet v. S. & L. Building Corp. , 53 S. Ct. 428 ( 1933 )
Lloyd F. Noonan v. Commissioner of Internal Revenue, Santa ... , 451 F.2d 992 ( 1971 )
Moline Properties, Inc. v. Commissioner , 63 S. Ct. 1132 ( 1943 )
Thomas International Limited v. The United States , 773 F.2d 300 ( 1985 )
Welch v. Helvering , 54 S. Ct. 8 ( 1933 )
National Carbide Corp. v. Commissioner , 69 S. Ct. 726 ( 1949 )
Sims v. United States , 79 S. Ct. 641 ( 1959 )
Westinghouse Electric Corp. v. Tully , 104 S. Ct. 1856 ( 1984 )