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376 (4th Cir. 1928), revg. 6 B.T.A. 1134 (1927); Macon, Dublin &
Savannah R.R. Co. v. Commissioner, 40 B.T.A. 1266, 1273 (1939);
Eastern Util. Inv. Corp. v. Commissioner, 38 B.T.A. 778, 788
(1938). If consolidation depended solely on legal or record
ownership, corporations with no real common ownership or economic
relationship could consolidate their income and deductions, in
violation of the statutory purpose. See Lavenstein Corp. v.
Commissioner, supra at 377; Macon, Dublin & Savannah R.R. Co. v.
Commissioner, supra at 1273. This Court has thus held that the
ownership referred to in section 1504(a) is beneficial ownership,
regardless of the arrangement by which it is created. Miami
National Bank v. Commissioner, supra at 801; see INI, Inc. v.
Commissioner, T.C. Memo. 1995-112.
The issue here turns on whether Kolonaki was the beneficial
owner of JAI stock. To determine whether Kolonaki had beneficial
ownership of JAI stock, we must look to the legal documents that
were executed and the rights created thereby. Miami National
Bank v. Commissioner, supra at 800. Additionally, in carrying
out this task, we look to the intent and agreement of the
parties. Id. at 803. Because courts cannot successfully
conjecture as to the subjective intent of the parties, the
objective evidence of intent provided by the parties' overt acts
must be relied upon. Ragghianti v. Commissioner, 71 T.C. 346,
350 (1978) (citing Pacific Coast Music Jobbers, Inc. v.
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