- 46 -
due was payable within 60 days thereafter. Consequently, we
conclude that CVI was obligated to reimburse CV for the export
promotion expenses at the close of its relevant taxable years.
Once the necessary information became available, the appropriate
book entries were prepared, effective as of January 31 of each
year. The making of the entries effective as of each of those
dates, while not conclusive, indicates that the parties intended
the transactions in each of those years to take place on each of
those dates. Deyoe v. Commissioner, 66 T.C. at 911; Clodfelter
v. Commissioner, 48 T.C. at 696, 700-701.
The foregoing circumstances persuade us that CV and CVI
intended that the reimbursement of expenses and payment of
dividends would occur on January 31 of each of CVI’s relevant
taxable years and that the transfers did occur on those dates.
Consequently, we conclude that the payments of expense
reimbursements and dividends occurring prior to the close of
CVI’s relevant taxable years were effective for the purpose of
satisfying section 992(a)(1)(B). Accordingly, we hold that the
funds paid to CV by CVI during CVI’s relevant taxable years that
were used to reimburse export promotion expenses and pay
dividends to CV were not assets of CVI as of the close of those
years for purposes of the 95 percent of assets test of section
992(a)(1)(B) in each of its taxable years ended January 31, 1983
and 1984, and that CVI qualified as a DISC for each of those
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