Carter, Rice & Co. v. Commissioner

1. A net loss sustained by a corporation prior to affiliation may be applied against, and to the amount of, its income for the succeeding year, after it becomes a member of the affiliated group. The excess of the loss, however, may not be applied against the consolidated income of the group. 2. A corporation keeping its accounts upon an accrual basis may not credit against its domestic tax liability for 1928 amounts paid by it in that year to a foreign government in discharge of additional tax liabilities for prior years, since such amounts are proper accruals for those years to which the tax…