- 69 -
2. Arguments of the Parties
Relying principally on Gottesman & Co. v. Commissioner,
77 T.C. 1149 (1981), petitioner argues that, in the absence of any
contrary guidance in the Code or regulations thereunder, section
56(a) imposes a minimum tax on every corporation and that the UBC
affiliated group must, therefore, compute its corporate minimum
tax by aggregating the tax imposed under section 56(a) on each
member of the group. Petitioner argues that, in calculating each
member's separate corporate minimum tax, it is entitled to adopt
any reasonable method of determining each member's separate
regular tax deduction under section 56(c), in particular the 1502-
33(d) allocation. Petitioner goes so far as to argue that
petitioner is required to use the 1502-33(d) allocation for
determining the separate regular tax deductions of the UBC
affiliated group's members under section 56(c). Petitioner argues
that, for the years in issue, the amount of the UBC affiliated
group's corporate minimum tax under petitioner's method is less
than the tax under UBC's method and, therefore, petitioner is
entitled to a refund for those years.
Respondent acknowledges that the regulations relating to
consolidated returns (the consolidated return regulations)21 do not
directly address the computation of the corporate minimum tax for
groups filing consolidated returns. Respondent argues, however,
that under the general rule of section 1.1502-80, Income Tax Regs.,
21 See secs. 1.1501-1 through 1.1552-1, Income Tax Regs.
Page: Previous 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 NextLast modified: May 25, 2011