Perkin-Elmer Corp. v. Commissioner
United States Tax Court
R allocated P's research and development expenses in accordance with the sales method set forth in sec. 1.861-8(e)(3)(ii), Income Tax Regs.
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R allocated P's research and development expenses in accordance with the sales method set forth in sec. 1.861-8(e)(3)(ii), Income Tax Regs. P asserts that the regulation is invalid because the sales method fails to take into account the research and development expenses of P's foreign subsidiaries and results in an overallocation of such expenses to such subsidiaries, thereby reducing P's foreign tax credit under secs. 901 and 904, I.R.C., exposing P to double taxation, and failing to achieve the objective of the foreign tax credit. P submits that its "worldwide" method of allocation of…
1Opinion of the Court
OPINION
Tannenwald, Judge:
In Perkin-Elmer Corp. v. Commissioner, T.C. Memo. 1993-414, we decided, after trial, a severed issue under section 482.1 A second issue, involving section 902, has been conceded by petitioner. The sole issue left for consideration is whether section 1.861-8(e)(3)(ii), Income Tax Regs., validly apportions research and development (R&D) expenses for petitioner’s 1978-81 taxable years, ending July 31, for purposes of computing a foreign tax credit limitation under section 904.
The case was submitted fully stipulated pursuant to Rule 122. The stipulated facts are found…
2Cases cited18 opinions
- United States v. CorrellSupreme Court of the United States · 1967
- National Muffler Dealers Assn., Inc. v. United StatesSupreme Court of the United States · 1979
- United States v. Vogel Fertilizer Co.Supreme Court of the United States · 1982
- Rowan Cos. v. United StatesSupreme Court of the United States · 1981
- Lykes v. United StatesSupreme Court of the United States · 1952
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