Wisconsin Department of Revenue v. Sentry Financial Services Corp.

The Wisconsin Department of Revenue appeals from a judgment and an order affirming a decision of the Tax Appeals Commission. The issues in the case relate to the department's authority under sec. 71.11(7m), Stats. (1981-82), to reallocate income between subsidiary and parent corporations to more "clearly reflect" their income,1 and that statute's relationship to sec. 71.311(l)(b), which declares certain intra-family corporate distributions to be tax-free.2

*905We hold that the commission properly overturned the department's allocation of income in this case on grounds that any gain or loss on the…