International Flavors & Fragrances, Inc. v. Commissioner
United States Tax Court
Petitioner and its foreign affiliates are engaged worldwide in the manufacture and distribution of flavoring extracts. In order to offset any loss which might be sustained in event of the devaluation of the British pound sterling, petitioner entered into a short sale contract for pounds sterling. After the pound was devalued, but before the delivery date, petitioner either sold or closed out its contract.
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Petitioner and its foreign affiliates are engaged worldwide in the manufacture and distribution of flavoring extracts. In order to offset any loss which might be sustained in event of the devaluation of the British pound sterling, petitioner entered into a short sale contract for pounds sterling. After the pound was devalued, but before the delivery date, petitioner either sold or closed out its contract. Held, the gain to petitioner on the transaction is taxable as ordinary income under the principles of Corn Products Co. v. Commissioner, 350 U.S. 46 (1955).
1Opinion of the Court
Quealy, Judge:
Respondent has asserted a deficiency in the Federal corporate income tax of petitioner for the taxable year 1967 in the amount of $73,715.
Certain concessions having been made by the parties, the following-issues remain for decision:(1) Whether petitioner’s gain on a contract for the short sale of 1.1 million pounds sterling, entered into with First National City Bank and subsequently sold or transferred to Amsterdam Overseas Corp. just prior to the closing date, is taxable as ordinary income under the doctrine of Corn Products Co. v. Commissioner, 350 U.S. 46 (1955), making the…
2Cases cited8 opinions
- Corn Products Refining Co. v. CommissionerSupreme Court of the United States · 1956
- Commissioner of Internal Rev. v. Farmers & G C. Oil Co.Court of Appeals for the Fifth Circuit · 1941
- America-Southeast Asia Co. v. CommissionerUnited States Tax Court · 1956
- Schlumberger Technology Corporation, Plaintiff-Appellee-Cross v. United States of America, Defendant-Appellant-CrossCourt of Appeals for the Fifth Circuit · 1971
- Kvp Sutherland Paper Company v. The United StatesUnited States Court of Claims · 1965
3 more not listed; retrieve them via the Exa API.
3Cited by19 opinions
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- National-Standard Co. v. CommissionerUnited States Tax Court · 1983
- Hoover Co. v. CommissionerUnited States Tax Court · 1979
- S. C. Johnson & Son, Inc. v. CommissionerUnited States Tax Court · 1975
- Carborundum Co. v. CommissionerUnited States Tax Court · 1980
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