Medieval Attractions N.V - Page 130

                                       - 77 -                                         
          Eurotor.  The letters informed L. Gelabert that the Internal                
          Revenue Service (IRS) had issued new reporting requirements for             
          U.S. corporations and foreign corporations operating in the                 
          United States that are owned by a foreign person.  The                      
          requirement was that a reporting entity had to report each                  
          transaction with a “related party” on IRS Form 5472, Information            
          Return of a Foreign Owned Corporation.  One letter stated that              
          transactions were defined broadly and included commissions,                 
          interest, rents and royalties paid and received, loans, sales,              
          purchases, and services performed by or for the reporting entity.           
          The letter continued:                                                       
               Separately, it is expected that the IRS will utilize                   
               the information contained on Form 5472 to determine                    
               whether the reported transactions were conducted at                    
               “arms-length”.  Thus, in reviewing transactions for                    
               preparation of the Form 5472, the vulnerability to                     
               attack by the IRS under the Section 482 arms-length                    
               standard should also be considered.                                    
          Hamlin sent a final IRS proof copy of Form 5472 with                        
          instructions.  Hamlin also offered to assist L. Gelabert in                 
          reviewing transactions to determine whether they must be reported           
          and “to further assist in minimizing the exposure to future IRS             
          audit adjustments under Section 482.”                                       
               No Forms 5472 were filed with the MTNV 1987 Federal return.            
          Neither MTNV nor MSI filed Forms 5472 with their Federal returns            
          for fiscal years ended 1988 and 1989 for transactions engaged in            
          with Manver, Gatetown, Lince, Futureprom, Attractours, Edemle,              
          Celin, Amsrott, Slider, Protravol, Etano, N.V. (Etano), or                  




Page:  Previous  67  68  69  70  71  72  73  74  75  76  77  78  79  80  81  82  83  84  85  86  Next

Last modified: May 25, 2011