Rent-A-Center, Inc. v. Commissioner
United States Tax Court
P, a domestic corporation, is the parent of numerous wholly owned subsidiaries including L, a Bermudian corporation. P conducted its business through stores owned and operated by its subsidiaries.
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P, a domestic corporation, is the parent of numerous wholly owned subsidiaries including L, a Bermudian corporation. P conducted its business through stores owned and operated by its subsidiaries. The other subsidiaries and L entered into contracts pursuant to which each subsidiary paid L an amount, determined by actuarial calculations and an allocation formula, relating to workers' compensation, automobile, and general liability risks, and, in turn, L reimbursed a portion of each subsidiary's claims relating to these risks. P's subsidiaries deducted, as insurance expenses, the payments to L.…
1Opinion of the Court
Foley, Judge:
Respondent determined deficiencies of $14,931,159, $13,409,628, $7,461,039, $5,095,222, and $2,828,861 relating, respectively, to Rent-A-Center, Inc. (RAC), and its subsidiaries’ 2003,1 2004, 2005, 2006, and 2007 (years in issue) consolidated Federal income tax returns. The issue for decision is whether payments to Legacy Insurance Co., Ltd. (Legacy), were deductible, pursuant to section 162,2 as insurance expenses.
FINDINGS OF FACT
RAC, a publicly traded Delaware corporation, is the parent of a group of approximately 15 affiliated subsidiaries (collectively, petitioner). During…
2Cases cited20 opinions
- Jack E. Golsen and Sylvia H. Golsen v. Commissioner of Internal RevenueCourt of Appeals for the Tenth Circuit · 1971
- Moline Properties, Inc. v. CommissionerSupreme Court of the United States · 1943
- Helvering v. Le GierseSupreme Court of the United States · 1941
- Carnation Company v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1981
- Clougherty Packing Company v. Commissioner of Internal RevenueCourt of Appeals for the Ninth Circuit · 1987
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3Cited by8 opinions
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- Rent-A-Center, Inc. and Affiliated Subsidiaries v. CommissionerUnited States Tax Court · 2014
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