Hospital Corporation of America and Subsidiaries - Page 36

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          They assert that the Black Motor formula was merely a tool for              
          determining a taxpayer's bad debt experience and was not                    
          mandatory for all circumstances.  Petitioners contend that, to              
          correctly apply the Black Motor formula, the regulations should             
          allow modifications or departures for particular facts and                  
          circumstances.  The foregoing arguments indicate that petitioners           
          use the term "Black Motor formula" to mean the reserve method of            
          accounting for bad debts that was in effect prior to repeal of              
          section 166(c) as well as the mathematical formula specified in             
          the case from which the method derives it name.  See Black Motor            
          Co. v. Commissioner, 41 B.T.A. 300, 302 (1940), affd. on another            
          issue 125 F.2d 977 (6th Cir. 1942).                                         
               As we view their position, petitioners essentially would               
          prefer to substitute for the nonaccrual-experience method                   
          provided by Congress the reserve method of accounting for bad               
          debts that was in effect prior to repeal of section 166(c)                  
          whereby the addition to the bad debt reserve was based on a                 
          reasonable amount determined by the taxpayer, with the                      
          reasonableness of that addition tested generally under the Black            
          Motor formula.  See Thor Power Tool Co. v. Commissioner, 439 U.S.           
          522, 546 (1979); Black Motor Co. v. Commissioner, supra.  That              
          result, however, is not consistent with the statute.  Nothing in            
          the statute or the legislative history requires the Uncollectible           
          Amount to equal the amount that would have been calculated                  






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