Collins Electrical Co. v. Commissioner
United States Tax Court
Two individuals owned over 75 percent of the stock and served as principal officers of each of two corporations. One of the corporations advanced large sums of money, interest free, to the other, and the Commissioner of Internal Revenue under sec. 482, I.R.C. 1954, allocated interest income to the lending corporation.
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Two individuals owned over 75 percent of the stock and served as principal officers of each of two corporations. One of the corporations advanced large sums of money, interest free, to the other, and the Commissioner of Internal Revenue under sec. 482, I.R.C. 1954, allocated interest income to the lending corporation. Held, on the facts, the two corporations were both owned and controlled by the same interests within the meaning of sec. 482, I.R.C. 1954. Held, further, the allocated interest income was properly computed with reference to the outstanding daily, rather than monthly, balances of…
1Opinion of the Court
Featherston, Judge:
Respondent determined deficiencies in petitioner’s Federal corporate income taxes for the fiscal years 1971 and 1972 as follows:
Sept. 30, 1971. $20,343.83
Sept. 30, 1972. 12.395.04
Total. 32,738.87
The only issue for decision is whether the Commissioner, pursuant to section 4821 and the regulations promulgated thereunder, erred in allocating interest income to petitioner for interest-free loans made to Del Monte Electric Co. during petitioner’s fiscal years 1971 and 1972.
FINDINGS OF FACT
Petitioner Collins Electrical Co., Inc. (hereinafter Collins or petitioner), was…
2Cases cited18 opinions
- Jack E. Golsen and Sylvia H. Golsen v. Commissioner of Internal RevenueCourt of Appeals for the Tenth Circuit · 1971
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- Commissioner of Internal Revenue v. Chelsea Products, IncCourt of Appeals for the Third Circuit · 1952
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