International Multifoods Corporation and Affiliated Companies - Page 16

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          Second, respondent maintains that the legislative intent                    
          underlying section 58(h) was well documented in the committee               
          reports accompanying the enactment of that section, while no                
          reference is made to section 865(j) in the relevant committee               
          reports.  Finally, respondent asserts that contrary to the                  
          instant case there were no controlling preexisting regulations in           
          Occidental Petroleum Corp.                                                  
               Respondent's arguments are unpersuasive.  First, we conclude           
          that Congress did intend that regulations promulgated pursuant to           
          section 865(j) would embody a "particular rule"; i.e., residence-           
          based sourcing would generally be used for losses realized on the           
          sale of noninventory personal property.  Second, respondent's               
          reliance on the absence of any mention of section 865(j) in the             
          committee reports is erroneous, since Congress articulated the              
          overall purpose behind section 865 in the legislative history.              
          See supra pp. 8-9.  In addition, the General Explanation confirms           
          that it was expected that losses generally would be sourced                 
          similarly to gains.  Although the General Explanation does not              
          technically rise to the level of legislative history, we have               
          nonetheless stated that "We are not unmindful of the fact that              
          both the Supreme Court, and this Court, have relied upon the                
          General Explanation in analyzing tax statutes * * * and that the            
          General Explanation is entitled to great respect".  Rivera v.               
          Commissioner, 89 T.C. 343, 349 n.7 (1987).                                  

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