American Terrazzo Strip Co. v. Commissioner
United States Tax Court
During its fiscal years ending June 30, 1959, 1960, 1961, and 1962, petitioner paid a Virgin Islands and a Puerto Rican corporation, controlled by the same interests as petitioner, excessive prices for terrazzo strip and rod with the result that petitioner's income tax returns for those years did not clearly reflect its income. Respondent made reallocations of gross income to petitioner. Held, respondent's reallocations were arbitrary and unreasonable.
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During its fiscal years ending June 30, 1959, 1960, 1961, and 1962, petitioner paid a Virgin Islands and a Puerto Rican corporation, controlled by the same interests as petitioner, excessive prices for terrazzo strip and rod with the result that petitioner's income tax returns for those years did not clearly reflect its income. Respondent made reallocations of gross income to petitioner. Held, respondent's reallocations were arbitrary and unreasonable. Pursuant to sec. 482, I.R.C. 1954, arm's-length prices for terrazzo strip and rod are determined under the standards prescribed by sec.…
1Opinion of the Court
Featherston, Judge;
Respondent determined the following deficiencies in petitioner’s income tax:
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A number of issues have been settled, and the only one for decision is whether respondent properly reallocated gross income and deductions from Caribe Metals Corp. and Caribe Metals Inc. to petitioner so as clearly to reflect the income of petitioner in accordance with section 482;1 and, if not, what reallocation of gross income and deductions, if any, should be made.
EINDINGS OE EAOT
American Terrazzo Strip Co., Inc. (hereinafter referred to as petitioner), a corporation organized under…
2Cases cited11 opinions
- Commissioner v. CulbertsonSupreme Court of the United States · 1949
- Hassett v. WelchSupreme Court of the United States · 1938
- Nat Harrison Assoc., Inc. v. CommissionerUnited States Tax Court · 1964
- Ach v. CommissionerUnited States Tax Court · 1964
- Commissioner of Internal Revenue v. Chelsea Products, IncCourt of Appeals for the Third Circuit · 1952
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- Brittingham v. CommissionerUnited States Tax Court · 1976
- Bausch & Lomb, Inc. v. CommissionerUnited States Tax Court · 1989
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