-5-
among those members that had taxable income for the year. This
allocation was based on the ratio that each member's regular tax
2(...continued)
Sec. 1552(a)(2) provides:
The tax liability of the group shall be
allocated to the several members of the group
on the basis of the percentage of the total
tax which the tax of such member if computed
on a separate return would bear to the total
amount of the taxes for all members of the
group so computed.
Sec. 1.1502-33(d)(2)(ii), Income Tax Regs., provides:
(ii)(a) The tax liability of the group,
as determined under paragraph (b)(1) of sec.
1.1552-1, shall be allocated to the members
in accordance with paragraph (a)(1), (2), or
(3) of sec. 1.1552-1, whichever is
applicable;
(b) An additional amount shall be
allocated to each member equal to a fixed
percentage (which does not exceed 100
percent) of the excess, if any, of (1) the
separate return tax liability of such member
for the taxable year (computed as provided in
paragraph (a)(2)(ii) of sec. 1.1552-1), over
(2) the tax liability allocated to such
member in accordance with (a) of this
subdivision (ii); and
(c) The total of any additional
amounts allocated pursuant to (b) of this
subdivision (ii) (including amounts allocated
as a result of a carryback) shall be credited
to the earnings and profits of those members
which had items of income, deductions, or
credits to which such total is attributable
pursuant to a consistent method which fairly
reflects such items of income, deductions, or
credits, and which is substantiated by
specific records maintained by the group for
such purpose.
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