George Georgiou and Judith Georgiou A.K.A. Judy Georgiou, et al. - Page 21

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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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