Southern Power Co. v. Commissioner
United States Board of Tax Appeals
1. Where one of several corporations which were affiliated elected to file a separate return, other members of the group of affiliated corporations may not file a consolidated return of their income. Action of the Commissioner in computing the tax liability of one of such corporations on the basis of its separate income approved. 2. Interest which accrued and was paid during the taxable year held to be income to the recipient.
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1. Where one of several corporations which were affiliated elected to file a separate return, other members of the group of affiliated corporations may not file a consolidated return of their income. Action of the Commissioner in computing the tax liability of one of such corporations on the basis of its separate income approved. 2. Interest which accrued and was paid during the taxable year held to be income to the recipient. It is immaterial that the earnings of the debtor were insufficient to pay such interest, or that such interest was paid from funds loaned to the debtor by the creditor.
1Opinion of the Court
*963OPINION.
Phillips:
It appears that during the years 1922 and 1923 the Wateree Electric Co. owned substantially all of the capital stock of Southern Power Co., which in turn owned all of the capital stock of *964the Catawba Manufacturing' & Electric Power Co. The Wateree Electric Co. filed a separate return of its income for those years, while the petitioners filed a consolidated return of their income. The Commissioner determined that the three corporations were affiliated and this determination is not questioned. The Commissioner further determined that since one of the affiliated corporations had…
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- Flambeau Public Service Co. v. CommissionerUnited States Board of Tax Appeals · 1932
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