Merrill Lynch & Co. v. Comm'r
United States Tax Court
MP is the parent of an affiliated group (P) that filed consolidated income tax returns for the taxable years at issue. 1986 Transactions: In 1986, P decided to sell the principal investments business of MLL, a second tier subsidiary.
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MP is the parent of an affiliated group (P) that filed consolidated income tax returns for the taxable years at issue. 1986 Transactions: In 1986, P decided to sell the principal investments business of MLL, a second tier subsidiary. Because P wanted to retain certain assets of MLL, consisting of its lease advisory business and certain other assets (the 1986 retained assets) within the consolidated group while minimizing or eliminating gain on the sale of MLL outside the consolidated group, P adopted and implemented a plan consisting of the following steps: (1) MLL distributed the 1986…
1Opinion of the Court
Marvel, Judge:
Respondent determined the following deficiencies in the Federal income tax of Merrill Lynch & Co., Inc. (Merrill Parent), & Subsidiaries (collectively, the consolidated group or petitioner):
TYE Deficiency
Dec. 26, 1986 $7,704,908
Dec. 25, 1987 12,141,242
Dec. 30, 1988 12,928,981
The ultimate issue in this case involves the proper computation of petitioner’s basis in the stock of two consolidated group members (the target corporations) that it sold in 1986 and 1987. In order to resolve that issue, we must decide the tax effect of nine cross-chain sales1 of stock of certain…
2Cases cited23 opinions
- Petzoldt v. CommissionerUnited States Tax Court · 1989
- Textile Mills Securities Corp. v. CommissionerSupreme Court of the United States · 1941
- Zenz v. QuinlivanCourt of Appeals for the Sixth Circuit · 1954
- Benjamin v. CommissionerUnited States Tax Court · 1976
- Blanche S. Benjamin v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1979
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3Cited by8 opinions
- Merrill Lynch & Co., Inc., and Subsidiaries v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 2004
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- Bruecher Foundation Services, Inc. v. United StatesDistrict Court, W.D. Texas · 2007
- Merrill Lynch & Co. v. Comm'rUnited States Tax Court · 2008
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