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Temporary Income Tax Regs. It is specific to the fact that
Federal taxes are reasonably considered a nondeductible, personal
expenditure. Section 1.163-8T, Temporary Income Tax Regs., is a
valid regulation and must be given "controlling weight".
NationsBank v. Variable Annuity Life Ins. Co., 513 U.S. at __,
115 S. Ct. at 813-814. Accordingly, section 1.163-9T(b)(2)(A),
Temporary Income Tax Regs., also is valid.
D. The Majority's Other Points
The above analysis is sufficient to convince me that the
majority has improperly invalidated portions of the temporary
regulations. Nonetheless, I will address certain of the
majority's other points.
1. The Legislative History of Section 163(h)
In reaching its holding, the majority relies in part on the
scant legislative history behind section 163(h). The majority's
main concern lies in the fact that the conference committee
report cryptically states that, after the enactment of section
163(h), personal interest will "generally" include interest on
tax deficiencies. H. Conf. Rept. 99-841 at II-154 (1986), 1986-3
C.B. (Vol. 4) at 154. The majority asserts that the term
"deficiencies" is a term of art and concludes that the word
"generally" must mean that Congress intended to carve out from
the term “personal interest” the interest on tax deficiencies
that are allocable to a trade or business within the meaning of
the decisions in Reise v. Commissioner, 35 T.C. 571 (1961), affd.
299 F. 2d 380 (7th Cir. 1962); Polk v. Commissioner 31 T.C. 412
(1958), affd. 276 F.2d 601 (10th Cir. 1960); and Standing v.
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