Federated Dep't Stores, Inc. v. Commissioner
United States Tax Court
On Feb. 1, 1964, F, a retail department store chain, sold its installment accounts receivables to FNB, a bank. The accounts contained service or carrying charges which F had not previously recognized as income. In exchange, FNB gave F cash in the amount of approximately 88 percent of the notes, and retained 10 percent as a contract reserve against which any defaults would be charged.
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On Feb. 1, 1964, F, a retail department store chain, sold its installment accounts receivables to FNB, a bank. The accounts contained service or carrying charges which F had not previously recognized as income. In exchange, FNB gave F cash in the amount of approximately 88 percent of the notes, and retained 10 percent as a contract reserve against which any defaults would be charged. Upon collection of the accounts, the contract reserve was to be reduced and paid over to F in such an amount so that the reserve did not exceed 10 percent of uncollected accounts. Held, even though the contract…
1Opinion of the Court
Federated Department Stores, Inc., Petitioner v. Commissioner of Internal Revenue, Respondent
Federated Dep't Stores, Inc. v. Commissioner
Docket No. 526-66
United States Tax Court
51 T.C. 500; 1968 U.S. Tax Ct. LEXIS 3;
December 30, 1968, Filed
Decision will be entered under Rule 50.
On Feb. 1, 1964, F, a retail department store chain, sold its installment accounts receivables to FNB, a bank. The accounts contained service or carrying charges which F had not previously recognized as income. In exchange, FNB gave F cash in the amount of approximately 88 percent of the notes, and retained 10 percent…
2Cases cited21 opinions
- Commissioner v. Glenshaw Glass Co.Supreme Court of the United States · 1955
- Commissioner v. HansenSupreme Court of the United States · 1959
- Edwards v. Cuba RailroadSupreme Court of the United States · 1925
- Brown Shoe Co. v. CommissionerSupreme Court of the United States · 1950
- Great Northern Ry. Co. v. Commissioner of Internal RevenueCourt of Appeals for the Eighth Circuit · 1930
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