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Sec. 1362(a)(2); Wilson v. Commissioner, 560 F.2d 687, 689 (5th Cir.
1977), affg. T.C. Memo. 1975-92.
Also, if an S election is to be effective for the current year
in which the election is made, section 1362(b)(2)(B) provides that
each person who was a shareholder at any time during the year (before
the time the election is made) is required to consent to the
election. Sec. 1362(b)(2)(B); sec. 18.1362-2(b), Temporary Income
Tax Regs., 48 Fed. Reg. 3591 (Jan. 26, 1983).
We note that during at least part of 1988, petitioner and TABC
treated Helmle as an owner of the stock of 2618 Inc. Until September
of 1988, TABC would not issue mixed beverage permits to the Club
because of Helmle's continuing ownership interest in 2618 Inc, and
Helmle certainly considered himself an owner of the stock of 2618
Inc. In 1988, petitioner actively sought a buyer for Helmle's
interest in 2618 Inc.
On the evidence, Helmle is to be considered a beneficial owner
of the stock of 2618 Inc during a part of 1988, and Helmle’s consent
therefore was necessary for the 2618 Inc's S election to be effective
for 1988. See sec. 1362(b)(2)(B); Wilson v. Commissioner, supra;
sec. 18.1362-2(b), Temporary Income Tax Regs., supra.
Respondent suggests that the duty of consistency prevents
petitioner from now contradicting the treatment of 2618 Inc on
petitioner's 1988 Federal income tax return as an S corporation. The
duty of consistency is generally applicable to prevent a taxpayer
from taking inconsistent positions in different taxable years when
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