Tower Loan of Mississippi, Inc. - Page 8

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                    In any case of two or more organizations, trades,                 
               or businesses * * * owned or controlled directly or                    
               indirectly by the same interests, the Secretary may                    
               distribute, apportion, or allocate gross income,                       
               deductions, credits, or allowances between or among                    
               such organizations, trades, or businesses, if he                       
               determines that such distribution, apportionment, or                   
               allocation is necessary in order to prevent evasion of                 
               taxes or clearly to reflect the income of any of such                  
               organizations, trades, or businesses. * * *                            
          Section 1.482-1(b)(1), Income Tax Regs., explains the purpose of            
          section 482 as follows:                                                     
               The purpose of section 482 is to place a controlled                    
               taxpayer on a tax parity with an uncontrolled taxpayer,                
               by determining, according to the standard of an                        
               uncontrolled taxpayer, the true taxable income from the                
               property and business of a controlled taxpayer. * * *                  
          Generally put, section 482 is designed to prevent artificial                
          distorting of the true net incomes of commonly controlled                   
          entities.  The Commissioner has broad discretionary power to                
          allocate income, and a heavier than normal burden is placed on              
          the taxpayer to prove that the allocation is arbitrary or                   
          unreasonable.  Procter & Gamble Co. v. Commissioner, 95 T.C. 323,           
          331 (1990), affd. 961 F.2d 1255 (6th Cir. 1992).  In meeting its            
          burden, petitioner must show that it did not improperly utilize             
          its control to shift income.  Id.                                           
               Petitioner concedes that it and AFLIC are under common                 
          control.  Petitioner, however, argues that it did not improperly            
          utilize its control over itself and AFLIC to shift commission               
          income from itself to AFLIC, because under Mississippi law it               
          would have been illegal for petitioner, during the years in                 

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