Acorn Refining Co. v. Commissioner
United States Board of Tax Appeals
1. NET LOSSES. - Petitioner acquired all the stock of eight corporations and they became affiliated in October 1929. Thereafter a consolidated return was filed. In computing the consolidated net income of the affiliated group for the taxable year, net losses of one subsidiary for two preceding years were deducted.
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1. NET LOSSES. - Petitioner acquired all the stock of eight corporations and they became affiliated in October 1929. Thereafter a consolidated return was filed. In computing the consolidated net income of the affiliated group for the taxable year, net losses of one subsidiary for two preceding years were deducted. Held, that the amount of the net losses of the subsidiary which may be deducted in computing consolidated net income is limited to the cost or aggregate basis of the stock of the subsidiary to the parent. Held, further, that article 41(c) of Regulations 75, providing for this…
1Opinion of the Court
*567OPINION.
Mellott :
The petitioner contests a deficiency in income tax determined by the respondent for the fiscal year ended January 31, 1931, in the amount of $7,809.93. The petitioner alleges that respondent erred (1) in disallowing as a deduction in computing the consolidated net income of an affiliated group the statutory net losses reported by its subsidiary, the Madison Paint Co., for the fiscal years ended January 31, 1929, and January 31, 1930, aggregating $69,760.97; and (2) in determining that the total cost or aggregate basis of the stock, of the Madison Paint Co., owned by members…
2Cases cited2 opinions
- Woolford Realty Co. v. RoseSupreme Court of the United States · 1932
- Charles Ilfeld Co. v. HernandezSupreme Court of the United States · 1934
3Cited by3 opinions
- Hughes Tool Co. v. CommissionerCourt of Appeals for the Fifth Circuit · 1941
- Acorn Refining Co. v. CommissionerUnited States Board of Tax Appeals · 1936
- Thomson v. CommissionerUnited States Tax Court · 1983