- 20 -
We hold that petitioner set forth in its statement a
sufficient basis for accumulating earnings in the amount of
$484,000 for its anticipated signage project for its 1992 and
1993 taxable years. Petitioner has provided sufficient details
to allow respondent to prepare for trial on this ground. We
conclude that respondent's arguments concerning petitioner's
anticipated signage project should be interposed at trial and
need not be addressed in deciding the instant motion.
Accordingly, we hold that respondent has the burden of proof as
to the fourth ground to the extent of $484,000 for petitioner's
1992 and 1993 taxable years.
5. Maintenance of Favorable Banking Relations
Petitioner states that it reasonably accumulated $1 million
during each of the years in issue to maintain a stated balance in
its operating account. Petitioner states that it maintained the
minimum balance so that service and transaction charges would be
waived, which petitioner estimates were on the order of $36,000.
In its statement, petitioner included a letter from Trust Company
Bank of Atlanta, dated April 26, 1995, which states that "the
average collected balance required to be maintained in the above
referenced operating account to cover various analysis (service)
charges was $1,000,000." Petitioner states that, during the
years in issue, the average required balance fluctuated between
$1,000,000 and $1,600,000.
Page: Previous 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 NextLast modified: May 25, 2011