Robert A. Stanford and Susan Stanford - Page 14

                                       - 14 -                                         
                         (iii) Qualified activity.--For purposes of this              
                    paragraph, the term "qualified activity" means any                
                    activity giving rise to--                                         
                              (I) foreign base company shipping income,               
                              (II) foreign base company oil related income,           
                              (III) foreign base company sales income,                
                              (IV) foreign base company services income,              
                              (V) in the case of a qualified insurance                
                         company, insurance income or foreign personal                
                         holding company income, or                                   
                              (VI) in the case of a qualified financial               
                         institution, foreign personal holding company                

               In summary, as the TAMRA chain deficit rule applies for                
          1990, subpart F income of profitable CFC's may only be reduced by           
          deficits in earnings and profits of unprofitable CFC's if each of           
          the CFC's is part of a "qualified chain" and if the subpart F               
          income of the profitable CFC's and the deficits in the earnings             
          and profits of the unprofitable CFC's relate to the same                    
          qualified activity.                                                         
               We first address the legal issue of whether Guardian Bank              
          and Guardian Services, as brother/sister corporations, qualify              
          under the TAMRA chain deficit rule as members of the same                   
          qualified chain.  Respondent contends that Guardian Bank and                
          Guardian Services do not qualify as qualified chain members                 
          because petitioner's ownership interest in Guardian Bank and                
          Guardian Services runs through a common parent corporation                  

Page:  Previous  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  21  22  23  Next

Last modified: May 25, 2011