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and owned 100 percent of Diesel Power's stock until at least
November 1974. Thus, Diesel Power was a controlled foreign
corporation until at least Diesel Power's fiscal (or Iranian
calendar) year, which ended March 20, 1975. Moreover, it is
agreed that petitioner owned at least 40 percent of Diesel
Power's voting stock until December 1977. Thus, the requirements
of section 1248(a) are met; i.e., the stock was sold by a United
States person who owned at least 10 percent of the foreign
corporation's voting stock, and he owned that stock at a time
when the foreign corporation was a controlled foreign corporation
and which fell within the 5-year period ending on the date of the
sale.
The only remaining question is the extent of Diesel Power's
accumulated earning and profits for purposes of section 1248
through Diesel Power's March 20, 1975, fiscal year. As reflected
on Diesel Power's financial statement, as of March 20, 1975, the
amount of retained earnings and the amount due shareholders
totaled $2,483,188.73. The March 20, 1975, fiscal year is the
appropriate date because during that year Diesel Power was a
controlled foreign corporation at least 1 day, as is required for
section 1248 to apply. Sec. 957(a). However, Diesel Power's
financial statements do not reflect foreign assets or amounts in
foreign bank accounts. In 1972, commission payments in excess of
$550,000 were deposited into the Bank of America account in
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