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wholly owned subsidiary pursuant to section 482.1 We hold that
it should not. (2) Whether petitioner can take a bad debt
deduction pursuant to section 166 for the 1989 tax year. We hold
that it cannot.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
The stipulation of facts filed by the parties and its
accompanying exhibits are incorporated herein by this reference.
At the time the petition was filed herein, petitioner, Tower Loan
of Mississippi, Inc., had its principal place of business in
Jackson, Mississippi.
Petitioner is engaged in the business of making small
consumer loans, ranging from $100 to $5,000. Petitioner is not a
bank or a savings and loan association. Petitioner was
incorporated in 1972 as a business corporation under the
Mississippi Business Corporation Act. Petitioner used the
accrual method of accounting during the years in issue.
In February 1983, petitioner organized two wholly owned
subsidiary insurance companies, the American Federated Life
Insurance Co. (AFLIC) and the American Federated Insurance Co.
(AFIC). In addition to providing financing to its customers,
petitioner makes available credit life insurance to its
1 All section references are to the Internal Revenue Code in
effect for the taxable years in issue, and all Rule references
are to the Tax Court Rules of Practice and Procedure, unless
otherwise stated.
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