Harmont Plaza, Inc. v. Commissioner
United States Tax Court
Petitioner leased property it owned in Youngstown, Ohio, to Sears, Roebuck & Co. under a long-term lease. In 1968, the Cafaros, who owned 90 percent of petitioner's stock, entered into an agreement with the DeBartolo interests to build an enclosed shopping mall on property owned by the two interests in Boardman, Ohio. A new corporation, Southern Park, Inc., was formed for that purpose.
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Petitioner leased property it owned in Youngstown, Ohio, to Sears, Roebuck & Co. under a long-term lease. In 1968, the Cafaros, who owned 90 percent of petitioner's stock, entered into an agreement with the DeBartolo interests to build an enclosed shopping mall on property owned by the two interests in Boardman, Ohio. A new corporation, Southern Park, Inc., was formed for that purpose. In order to induce Sears to move from the Youngstown location to Southern Park the interested parties entered into various agreements whereunder Southern Park, Inc., indemnified petitioner for any loss of…
1Opinion of the Court
Drennen, Judge:
Respondent determined deficiencies in the Federal income tax of Harmont Plaza, Inc., as follows:1
FYE Nov. 30— Deficiency
1967_ $27,081.92
1968_ 12,208.84
1970_ 11,067.93
1971_ 369.58
In the statutory notice which gave rise to this action, the respondent added to petitioner’s taxable income for each of the years ended November 30, 1970, and November 30, 1971, an amount with respect to depreciation of $965.92. Petitioner concedes the correctness of this adjustment. The sole issue remaining for decision is whether petitioner is required to accrue under section 451(a), I.R.C. 1954, the…
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