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Federal income tax of $27,844 and $31,888, respectively. These
cases (docket No. 27615-92 for 1988 and docket No. 608-93 for
1990 and 1991) have been consolidated for purposes of trial,
briefing, and opinion pursuant to Rule 141(a).
The sole issue for decision is whether petitioner is
entitled to credits against income taxes pursuant to section 29
for selling a qualified fuel to an unrelated person. We hold
that petitioner is not entitled to such credits.
Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for the years in issue, and
all Rule references are to the Tax Court Rules of Practice and
Procedure.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
The Stipulations of Facts are incorporated by this reference.
Petitioner is a Kentucky corporation whose principal place of
business was in Mauckport, Indiana, at the time the petitions in
these cases were filed.
I. The Veneer-Production Process
Petitioner is a wood veneer and lumber company incorporated
in 1971. From 1971-1979, petitioner took its logs to an
unrelated veneer mill, which converted them into veneer for a
fee. Petitioner then sold the veneer to its customers. In 1979,
petitioner purchased a wood-burning system that consisted of a
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