B. Forman Co. v. Commissioner
United States Tax Court
In 1958, petitioners organized MidtownHoldings Corp. for the purpose of constructing and operating an enclosed mall shopping center adjacent to their department stores. They had equal ownership and control of Midtown. The shopping center opened for business in 1962. During the years in issue, Midtown paid no interest on certain loans made to it by petitioners.
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In 1958, petitioners organized MidtownHoldings Corp. for the purpose of constructing and operating an enclosed mall shopping center adjacent to their department stores. They had equal ownership and control of Midtown. The shopping center opened for business in 1962. During the years in issue, Midtown paid no interest on certain loans made to it by petitioners. In addition, petitioners made certain equal payments to Midtown ostensibly to prevent the erection of kiosks in the part of the mall adjacent to their stores. Held, that respondent may not utilize sec. 482, I.R.C. 1954, to impute…
1Opinion of the Court
OPINION
Imputation of Interest Income Under Section 4-8B
Each, petitioner owns and operates a department store in downtown Rochester, N.Y. In 1958, petitioners organized Midtown Holdings Gorp. as a vehicle for constructing and operating an enclosed-mall shopping center abutting upon their department stores. It was hoped that the shopping center would not only revitalize their business, but also enhance the value of their real estate investment.
The project (known as Midtown Plaza) turned out to be far more expensive than expected. In consequence, petitioners from time to time made various loans…
2Cases cited21 opinions
- Welch v. HelveringSupreme Court of the United States · 1933
- Commissioner v. HeiningerSupreme Court of the United States · 1943
- Hanover Bank v. CommissionerSupreme Court of the United States · 1962
- Grenada Industries, Inc. v. Commissioner of Internal RevenueCourt of Appeals for the Fifth Circuit · 1953
- Dean v. CommissionerUnited States Tax Court · 1961
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3Cited by1 opinion
- B. Forman Co. v. CommissionerUnited States Tax Court · 1970