T.C. Memo. 1996-159
UNITED STATES TAX COURT
AMOCO CORPORATION (Formerly STANDARD OIL COMPANY (INDIANA))
AND AFFILIATED CORPORATIONS, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 20471-92. Filed March 28, 1996.
S, a subsidiary of P, entered into a concession
agreement with E, an entity owned and controlled by the
Egyptian Government. Under the agreement, which had
the force of law, E was responsible for the payment of
S's Egyptian income tax liability. For the years in
issue, E took a credit against its own tax liability
for the amount of taxes paid on behalf of S. The
Egyptian Tax Department determined that E was not
entitled to a credit and was allowed only to deduct
such payments from its taxable income. It assessed
back taxes against E for a portion of the years in
issue. Collection was foreclosed by the running of the
Egyptian statutory period of limitations. Held, E was
not authorized to credit Egyptian taxes paid on behalf
of S against its income tax liability. Held, further,
there was no refund of Egyptian taxes to or for the
account of P. Held, further, E should be included in
the term "foreign country" for purposes of sec. 901,
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