Specialized Services, Inc. v. Commissioner
United States Tax Court
Superior, a subsidiary corporation of petitioner, operates as a motor vehicle common carrier. Superior carries liability insurance for financial protection against the risk of bodily injury to employees and third parties, as well as the risk of damage to cargo and other property which would arise as a result of vehicular accidents occurring during the normal business operations. As of Sept. 1, 1976, the insurance policy provided for a $ 50,000 deductible.
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Superior, a subsidiary corporation of petitioner, operates as a motor vehicle common carrier. Superior carries liability insurance for financial protection against the risk of bodily injury to employees and third parties, as well as the risk of damage to cargo and other property which would arise as a result of vehicular accidents occurring during the normal business operations. As of Sept. 1, 1976, the insurance policy provided for a $ 50,000 deductible. On that same date Superior, the insurer, and a bank executed a Loss Fund Agreement which specified that any funds placed on deposit into an…
1Opinion of the Court
Scott, Judge-.
Respondent determined a deficiency in petitioner’s income tax for taxable year 1976 in the amount of $156,756.
The only issue for decision is whether amounts transferred on December 31, 1976, by one of petitioner’s subsidiary corporations to a bank-managed "Escrow Trust Fund,” which the subsidiary established to hold funds sufficient in amount for the satisfaction of contested accident claims filed by third-party claimants, constituted transfers of "money or other property to provide for the satisfaction of the asserted liability” within the meaning of section 461(f)(2), I.R.C.…
2Cases cited4 opinions
- Consolidated Freightways, Inc. & Affiliates v. CommissionerUnited States Tax Court · 1980
- Poirier & McLane Corporation v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1976
- Poirier & McLane Corp. v. CommissionerUnited States Tax Court · 1975
- Lummus Supply Co. v. Fidelity Federal Savings & Loan Ass'nCourt of Appeals of Georgia · 1977
3Cited by4 opinions
- Consolidated Freightways, Inc. v. CommissionerCourt of Appeals for the Ninth Circuit · 1983
- Consolidated Freightways, Inc., and Affiliates v. Commissioner of Internal Revenue, Commissioner of Internal Revenue v. Consolidated Freightways, Inc., and AffiliatesCourt of Appeals for the Ninth Circuit · 1983
- Malone & Hyde, Inc. v. CommissionerUnited States Tax Court · 1989
- Specialized Services, Inc. v. CommissionerUnited States Tax Court · 1981