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corporate business purposes. This is independent of the device
test. The requirement limits tax-free treatment under section
355 to spin-offs motivated by non-tax business reasons, and thus
prevents tax avoidance opportunities from arising. Id. Section
1.355-2(b)(2), Income Tax Regs., defines a corporate business
purpose as a real and substantial non-Federal tax purpose germane
to the distributing corporation, the controlled corporation, or
the affiliated group to which the distributing corporation
belongs. Although respondent maintains that a purely shareholder
purpose will not support a tax-free spin-off, there are some
situations in which a shareholder purpose may be so intertwined
with a corporate business purpose that it is not practical to
separate the two. In such a case, the transaction is considered
carried out for a corporate business purpose. Sec. 1.355-
2(b)(2), Income Tax Regs. See Estate of Parshelsky v.
Commissioner, 303 F.2d 14 (2d Cir. 1962), reversing and remanding
34 T.C. 946 (1960), on remand T.C. Memo. 1963-187, holding that a
shareholder non-tax purpose may be an adequate business purpose
for a spin-off. See also Rafferty v. Commissioner, 452 F.2d 767
(1st Cir. 1971), affg. 55 T.C. 490 (1970), and Wilson v.
Commissioner, 353 F.2d 184 (9th Cir. 1965), reversing and
remanding 42 T.C. 914 (1964), which approached the business
purpose issue from different theoretical bases. In Rafferty,
evidence of lack of business purpose was considered by the Court
of Appeals as bearing on the "device" requirement. In Wilson,
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