Schering Corp. v. Commissioner
United States Tax Court
T, a United States corporation, owned all of the stock of S, a Swiss corporation. On audit of T's Federal Corporate income tax returns for 1961-63, the Commissioner exercised his authority under section 482, I.R.C. 1954, to reallocate to T certain income which S had reported as its income, and on which S had paid Swiss income taxes. The reallocated income represented a portion of certain royalties and amounts received by S pursuant to licensing agreements.
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T, a United States corporation, owned all of the stock of S, a Swiss corporation. On audit of T's Federal Corporate income tax returns for 1961-63, the Commissioner exercised his authority under section 482, I.R.C. 1954, to reallocate to T certain income which S had reported as its income, and on which S had paid Swiss income taxes. The reallocated income represented a portion of certain royalties and amounts received by S pursuant to licensing agreements. Similar reallocations were made to T in respect of income received by a Swiss sales corporation that was wholly owned by S. The…
1Opinion of the Court
Raum, Judge:
The Commissioner determined a deficiency in petitioner’s Federal corporate income tax for the calendar year 1969 in the amount of $143,085.07. The sole issue raised by the petition is whether petitioner is entitled, pursuant to section 901(a), I.R.C. 1954, to a credit of $224,074 for amounts withheld and paid to Switzerland by petitioner’s Swiss subsidiary as a withholding tax on amounts repatriated to petitioner pursuant to Rev. Proc. 65-17,1965-1 C.B. 833, subsequent to a reallocation of income to petitioner from its Swiss subsidiary under section 482.
FINDINGS OF FACT
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2Cases cited35 opinions
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