108 T.C. No. 26
UNITED STATES TAX COURT
INTERNATIONAL MULTIFOODS CORPORATION AND AFFILIATED COMPANIES,
Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 11643-92. Filed June 18, 1997.
On Mar. 30, 1987, P, a domestic corporation,
entered into an agreement with Borden to sell P's stock
in Paty, a limitada organized under the laws of the
Federal Republic of Brazil. P realized a loss upon the
sale of the Paty stock, which P reported as a U.S.
source loss for purposes of its foreign tax credit
computation under sec. 904(a), I.R.C. R determined
that the loss was foreign source.
Held: P's loss is sourced in the United States.
Sec. 865, I.R.C., which provides that income from the
sale of noninventory personal property is generally
sourced at the residence of the seller, is also
generally applicable in sourcing losses realized on the
sale of such property.
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