107 T.C. No. 12
UNITED STATES TAX COURT
FORT HOWARD CORPORATION AND SUBSIDIARIES, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent*
Docket No. 6362-92. Filed October 22, 1996.
In Fort Howard Corp. v. Commissioner, 103 T.C. 345
(1994), we held that sec. 162(k), I.R.C., precluded
petitioner from deducting or amortizing the costs and
fees, other than interest, that petitioner paid in 1988
to borrow funds used in the leveraged buyout of its
stock. Sec. 1704(p) of the Small Business Job
Protection Act of 1996, Pub. L. 104-188, 110 Stat.
1755, 1868, which was signed by the President on Aug.
20, 1996, and applies retroactively to 1988, provides
that the expense disallowance rule of sec. 162(k) does
not apply to any "deduction for amounts which are
properly allocable to indebtedness and amortized over
the term of such indebtedness". Held: In light of
this statutory modification, we now hold that the
expense disallowance rule of sec. 162(k), as amended on
Aug. 20, 1996, does not preclude petitioner from taking
*This opinion supplements our previously filed opinion in
Fort Howard Corp. v. Commissioner, 103 T.C. 345 (1994).
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