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            Dazs, contain any of the other information required by the                                  
            regulations under sections 351, 355, or 368, or allocate earnings                           
            and profits between petitioner and SIC as required by section                               
            312(h) and associated regulations with respect to a transaction                             
            governed by sections 355 and 368(a)(1)(D).                                                  
                  On April 10, 1989, SIC filed Form 1120S for its tax year                              
            1988, which included a statement disclosing the sale of assets by                           
            SIC, including records and goodwill for $286,068 and the “right                             
            to distribute the product of buyer for $1,144,272”.13  The                                  
            statement also disclosed that Arnold, as sole stockholder                                   
            distributee, would report the gain on his personal income tax                               
            return for taxable year 1988.  On July 14, 1989, Arnold caused                              
            SIC to be dissolved under New Jersey law.                                                   
                  For each tax year thereafter through 1995, MIC reported the                           
            following losses and gross sales as compared with 1988 and                                  
            earlier years:                                                                              
                  13 This statement attached to the SIC Form 1120S indicates                            
            that the downward adjustment of $69,660 to the purchase price                               
            paid by H�agen-Dazs at closing was allocated between the                                    
            distribution rights and business records of SIC in the same                                 
            proportions as the relative amounts of the preadjustment                                    
            allocation of the purchase price to be paid at the closing--80                              
            percent, or $55,728, to the distribution rights, and 20 percent,                            
            or $13,932, to the business records.  The closing documents do                              
            not set forth or otherwise contain any reference to the                                     
            allocation between distribution rights and business records of                              
            the reduction in the price paid at closing.                                                 
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