Tate & Lyle, Inc. v. Commissioner
United States Tax Court
P is an affiliated group of corporations that filed consolidated U.S. Corporation Income Tax Returns. TLI and RSI are members of P. TLI and RSI accrued interest payable to their foreign parent corporation, PLC, and P deducted such interest in its consolidated returns. Pursuant to the U.S.-U.K. Income Tax Treaty, the interest payable to PLC was exempt from tax and not includable in PLC's gross income for U.S. tax purposes.
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P is an affiliated group of corporations that filed consolidated U.S. Corporation Income Tax Returns. TLI and RSI are members of P. TLI and RSI accrued interest payable to their foreign parent corporation, PLC, and P deducted such interest in its consolidated returns. Pursuant to the U.S.-U.K. Income Tax Treaty, the interest payable to PLC was exempt from tax and not includable in PLC's gross income for U.S. tax purposes. R disallowed P's accrued interest expense deductions on the grounds that sec. 267(a)(2) and ( 3), I.R.C., and sec. 1.267(a)-3, Income Tax Regs., require that the interest be…
1Opinion of the Court
OPINION
Ruwe, Judge:
Respondent determined deficiencies in petitioner’s Federal income taxes and additions to tax as follows:
Additions to tax
FYE Deficiency Sec. 6653(a)(1) Sec. 6653(a)(2) Sec. 6661(a)
9/29/85 $1,244,862 $62,243 50 percent of the interest due on $1,244,862 $311,215
Additions to tax
FYE Deficiency Sec. 6653(a)(1)(A) Sec. 6653(a)(1)(B) Sec. 6661(a)
9/28/86 $3,437,849 $171,892 50 percent of the interest due on $3,437,849 $859,462
9/26/87 5,130,100 256,505 50 percent of the interest due on $5,130,100 1,282,525
The sole issue for decision is whether petitioner may deduct interest owed to…
2Cases cited38 opinions
- Chevron U. S. A. Inc. v. Natural Resources Defense Council, Inc.Supreme Court of the United States · 1984
- Usery v. Turner Elkhorn Mining Co.Supreme Court of the United States · 1976
- Pension Benefit Guaranty Corporation v. RA Gray & Co.Supreme Court of the United States · 1984
- Automobile Club of Mich. v. CommissionerSupreme Court of the United States · 1957
- United States v. CorrellSupreme Court of the United States · 1967
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3Cited by24 opinions
- Tate & Lyle, Inc. And Subsidiaries v. Commissioner of Internal Revenue ServiceCourt of Appeals for the Third Circuit · 1996
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- Coca-Cola Co. v. CommissionerUnited States Tax Court · 1996
- Square D Co. v. Comm'rUnited States Tax Court · 2002
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