Superior Beverage Co. v. Commissioner

OPINION

Before CHAMBERS and MERRILL, Circuit Judges, and PALMIERI,* District Judge. CHAMBERS, Circuit Judge:

This is an appeal from a decision of the Tax Court reported with a detailed factual description at 58 T.C. 918 (1972) assessing deficiencies in the income tax of each of the appellant corporations for the years 1966, 1967, and 1968. We reverse.

As a general rule under 26 U.S.C. § 11(d), every corporation is entitled to a yearly surtax exemption of $25,000. If a company is. a member of a “controlled group of corporations,” it is entitled to only its proportionate share of a single $25,000…