Philip Morris Inc. v. Commissioner
United States Tax Court
P borrowed in foreign currencies which it converted into U.S. dollars and later repaid the borrowings in the same foreign currency which it had purchased with U.S. dollars.
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P borrowed in foreign currencies which it converted into U.S. dollars and later repaid the borrowings in the same foreign currency which it had purchased with U.S. dollars. P reported its gain, represented by the difference in U.S. dollars between the value of the foreign currencies at the time of the borrowings and the U.S. dollar cost of the currencies used for repayment, as income from the discharge of indebtedness and elected to exclude such income from gross income under sec. 108, I.R.C., and reduce the basis in its assets under sec. 1017, I.R.C.Held: P's gain does not constitute income…
1Opinion of the Court
OPINION
Tannenwald, Judge:
Respondent determined deficiencies in petitioner’s Federal income taxes for the 1982, 1983, and 1984 taxable years in the amounts of $4,594,256, $11,217,945, and $6,111,795, respectively. The parties have settled all but one issue involving the proper treatment of gains resulting from the use of foreign currency, the value of which changed in relation to the U.S. dollar between the dates of borrowings and repayments in the same currency.
All the facts have been stipulated and are so found. The stipulation of facts and the exhibits attached thereto are incorporated…
2Cases cited23 opinions
- Jack E. Golsen and Sylvia H. Golsen v. Commissioner of Internal RevenueCourt of Appeals for the Tenth Circuit · 1971
- Bowers v. Kerbaugh-Empire Co.Supreme Court of the United States · 1926
- United States v. Centennial Savings Bank FSBSupreme Court of the United States · 1991
- Bernard A. Levin, Phyllis Levin, Alan T. Hrabosky, and Delores Hrabosky v. Commissioner of Internal RevenueCourt of Appeals for the Seventh Circuit · 1987
- Levin v. CommissionerUnited States Tax Court · 1986
18 more not listed; retrieve them via the Exa API.
3Cited by2 opinions
- Philip Morris Inc. v. CommissionerUnited States Tax Court · 1995
- Philip Morris Inc. v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1995