Continental Equities, Inc., Cross-Appellant v. Commissioner of Internal Revenue, Cross-Appellee

CLARK, Circuit Judge:

This appeal and cross-appeal are taken from a decision of the United States Tax Court. The Commissioner of Internal Revenue [Commissioner] challenges a ruling invalidating the assessment of an income tax deficiency against Continental Equities, Inc. [Continental]. The Commissioner contends that two net operating loss deductions taken by Continental should have been disallowed. Continental cross-appeals, urging that the Tax Court erred in upholding the Commissioner’s decision to allocate to Continental interest income resulting from loans it made to four related…