Consolidated Foods Corp. v. Commissioner
United States Tax Court
A State municipality issued $ 2 million of industrial development bonds to finance construction of a manufacturing facility. The municipality leased the facility for 25 years to Conso Fastener Corp., which paid semiannual rental payments equal to principal and interest due on the bonds.
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A State municipality issued $ 2 million of industrial development bonds to finance construction of a manufacturing facility. The municipality leased the facility for 25 years to Conso Fastener Corp., which paid semiannual rental payments equal to principal and interest due on the bonds. The actual construction cost of the facility was $ 178,506 less than the anticipated construction cost of $ 2 million; the resulting surplus of bond proceeds was credited against lease payments due in years immediately following completion of construction. Held, Conso Fastener Corp., an accrual basis taxpayer…
1Opinion of the Court
OPINION
Wiles, Judge:
Respondent determined deficiencies in the income taxes of Conso Fastener Corp. (hereinafter Conso) as follows:
FYE June 30— Amount
1967_ $3,500
1968_ 55,517
1969_ 35,757
Total_ 94,774
Petitioner is a transferee of Conso and thereby is liable for any taxes determined to be due from Conso. The only issue for decision is whether Conso correctly computed its rental deductions under section 162(a)(3)1 by properly crediting surplus industrial bond proceeds against lease payments which originated in the underlying industrial development bonds.
This case was fully stipulated pursuant to…
2Cases cited18 opinions
- City of New York v. SaperSupreme Court of the United States · 1949
- Louis Spitalny and Betty Spitalny, His Wife v. United States of America, William Erdwurm and Bart F. Erdwurm, His Wife v. United StatesCourt of Appeals for the Ninth Circuit · 1970
- Farr v. CommissionerUnited States Tax Court · 1948
- Sloane v. Commissioner of Internal RevenueCourt of Appeals for the Sixth Circuit · 1951
- Your Health Club, Inc. v. CommissionerUnited States Tax Court · 1944
13 more not listed; retrieve them via the Exa API.
3Cited by5 opinions
- VECO Corp. & Subsidiaries v. CommissionerUnited States Tax Court · 2013
- Consolidated Foods Corp. v. CommissionerUnited States Tax Court · 1976
- Rojas v. CommissionerUnited States Tax Court · 1988
- Rojas v. CommissionerUnited States Tax Court · 1988
- Veco Corporation And Subsidiaries v. CommissionerUnited States Tax Court · 2013