Cane Creek Sportsman's Club, Inc. - Page 7

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          State corporate charter possesses the attributes of a corporation           
          so as to be treated as one for Federal tax purposes.  In this               
          case, however, we have before us an incorporated entity wishing             
          to disavow that form.                                                       
               We shall not disregard a corporation for Federal tax                   
          purposes if either (1) the corporation was formed for business              
          purposes, or (2) its creation is followed by the carrying on of             
          business activity.  See Moline Properties, Inc. v. Commissioner,            
          319 U.S. 436 (1943).  Petitioner's tax existence under Federal              
          law is established if either test is satisfied.  See Carver v.              
          United States, supra at 236.  Rarely is a corporation's tax                 
          identity ignored, unless it is a sham.  See Bennett Paper Corp.             
          v. Commissioner, 699 F.2d 450, 452 (8th Cir. 1983), affg. 78 T.C.           
          458 (1982); Strong v. Commissioner, 66 T.C. 12, 22 (1976), affd.            
          without published opinion 553 F.2d 94 (2d Cir. 1977).                       
               Hooper and Chamblee argue that petitioner conducted no                 
          business activity--that it merely held naked record title to the            
          property and therefore it "never [was] a business venture".  We             
          disagree and find, under the second part of the Moline                      
          Properties, Inc. test, that petitioner actually engaged in                  

               2We offer no opinion as to whether the first part of the               
          test under Moline Properties, Inc. v. Commissioner, 319 U.S. 436            
          (1943), is also satisfied.                                                  

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