Fieldcrest Mills, Inc. v. Coble

SHARP, Chief Justice.

The facts of the present case can be reduced to the following formula. “A,” a parent corporation, incorporates “B,” a wholly owned subsidiary, to perform a vital manufacturing service required by “A” corporation in its own production. “B” not only provides the service to “A” corporation, but 40% of its business is conducted with others. The two corporations operate as parent and subsidiary, filing separate state income tax returns as required by state law and consolidated income tax returns as permitted by federal law. After “B” experiences net operating losses for a…