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earned by the PLRF was available for use to discharge the
Dealerships' obligations either currently or in future, as
needed. It follows that the Dealerships are treated as owners of
the entire trust, provided that the application of trust income
for the Dealerships' benefit in this manner did not depend upon
the approval or consent of an adverse party. Sec. 1.677(a)-1(c)
and (d), Income Tax Regs.
The Administrator Agreement requires the authorization of
both Escrow Trustees (the Managing Agent and Administrator) for
release of any reserves from the PLRF. Since the Administrator
is entitled to receive any investment income of the PLRF not paid
to or used for the benefit of the Dealerships, the Administrator
plainly holds an interest in the PLRF that is adversely affected
by the release of income to or for the benefit of the
Dealerships. However, the authorization contemplated by the
Administrator Agreement is not the exercise of a "power" within
the meaning of section 672(a). A power for purposes of subpart E
of subchapter J means a discretionary right to control the
beneficial enjoyment of trust income, and it is relevant to the
question of the grantor's ownership of the trust only to the
extent that it can be exercised out of self-interest at the
grantor's expense. See H. Rept. 1337, supra at A212, A217; sec.
1.677(a)-1(e), Income Tax Regs.
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