Rodriguez v. Commissioner
United States Tax Court
Ps, citizens of Mexico and permanent residents of the United States, were the sole shareholders of E, a controlled foreign corporation. Pursuant to secs. 951(a)(1)(B) and 956, I.R.C., they included in their gross income amounts of E's earnings that were invested in U.S. property. Ps characterized these inclusions as qualified dividend income subject to preferential income tax rates under sec. 1(h)(11), I.R.C.
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Ps, citizens of Mexico and permanent residents of the United States, were the sole shareholders of E, a controlled foreign corporation. Pursuant to secs. 951(a)(1)(B) and 956, I.R.C., they included in their gross income amounts of E's earnings that were invested in U.S. property. Ps characterized these inclusions as qualified dividend income subject to preferential income tax rates under sec. 1(h)(11), I.R.C. R recharacterized these amounts as ordinary income subject to nonpreferential income tax rates. Held: Inclusions in gross income as required under secs. 951(a)(1)(B) and 956, I.R.C., do…
1Opinion of the Court
OPINION
Thornton, Judge:
Respondent determined deficiencies of $316,950 and $295,530 in petitioners’ Federal income taxes for taxable years 2003 and 2004, respectively. The issue for decision is whether amounts included in petitioners’ gross income pursuant to sections 951(a)(1)(B) and 956 1 with respect to their controlled foreign corporation’s investments in U.S. property (for brevity, section 951 inclusions) constitute qualified dividend income under section l(h)(ll).
Background
The parties submitted this case fully stipulated pursuant to Rule 122. When they petitioned the Court, petitioners…
2Cases cited12 opinions
- Weinberger v. Hynson, Westcott & Dunning, Inc.Supreme Court of the United States · 1973
- Commissioner v. GordonSupreme Court of the United States · 1968
- Truesdell v. Comm'rUnited States Tax Court · 1987
- Elec. Arts, Inc. v. Comm'rUnited States Tax Court · 2002
- Boulware v. United StatesSupreme Court of the United States · 2008
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