Sundstrand Corp. v. Commissioner
United States Tax Court
During 1977 and 1978, petitioner and its subsidiaries manufactured and sold numerous products, including the constant speed drive (CSD), an extremely complex avionic device used to drive an airplane engine's generator at a constant speed regardless of the speed of the engine. In 1974, petitioner decided to expand the operations at SunPac, petitioner's wholly owned foreign subsidiary located in the Republic of Singapore, to include the production of CSD's.
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During 1977 and 1978, petitioner and its subsidiaries manufactured and sold numerous products, including the constant speed drive (CSD), an extremely complex avionic device used to drive an airplane engine's generator at a constant speed regardless of the speed of the engine. In 1974, petitioner decided to expand the operations at SunPac, petitioner's wholly owned foreign subsidiary located in the Republic of Singapore, to include the production of CSD's. Pursuant to a license agreement entered into in July 1975, petitioner gave SunPac the exclusive right to use petitioner's industrial…
1Opinion of the Court
HAMBLEN, Judge:
Respondent determined deficiencies of $1,569,156 and $5,931,159 in petitioner’s1 Federal income tax for taxable years ending December 31, 1977, and December 31, 1978, respectively (hereinafter sometimes referred to as the years in issue).
STATEMENT OF ISSUES
The issues involved in this case are as follows:
1. Whether respondent’s allocations of gross income under section 4822 for the years in issue were arbitrary, capricious, and unreasonable.
2. Whether royalties paid to petitioner by Sundstrand Pacific (Pte) Ltd. (hereinafter referred to as SunPac), petitioner’s wholly owned…
2Cases cited38 opinions
- Cohan v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1930
- Petzoldt v. CommissionerUnited States Tax Court · 1989
- Buffalo Tool & Die Mfg. Co. v. CommissionerUnited States Tax Court · 1980
- Parker v. CommissionerUnited States Tax Court · 1986
- Solowiejczyk v. CommissionerUnited States Tax Court · 1985
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3Cited by76 opinions
- LeFever v. CommissionerCourt of Appeals for the Tenth Circuit · 1996
- Bausch & Lomb Incorporated and Consolidated Subsidiaries v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1991
- Seagate Technology v. CommissionerUnited States Tax Court · 1994
- Winnett v. CommissionerUnited States Tax Court · 1991
- Nestle Holdings v. CommissionerUnited States Tax Court · 1995
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