Baan v. Commissioner

OPINION

Raum, Judge:

American Telephone & Telegraph Co. (American), a New York corporation, owned all of the stock or at least a controlling interest in the stock of some 21 corporations engaged in the business of furnishing telephone and other communications services within the United States. In the aggregate, American and its various subsidiaries comprise what is sometimes referred to as the Bell System. Its stock ownership in its west coast subsidiary, Pacific Telephone & Telegraph Co. (Pacific), represented some 89 percent of the latter’s voting control. The minority shares in Pacific were…