Union Carbide Corporation and Subsidiaries - Page 8

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          and no additional tax has been assessed against UCFSC for the                
          aforementioned years.                                                        
               On December 12, 1996, the parties held a telephone                      
          conference call with the Court in which it was agreed that the               
          threshold issue of whether or not petitioner had timely asserted             
          its claims for additional FSC commission expenses under the                  
          Regulation would be considered apart from the substantive merits             
          of those recomputations.  On the basis of that discussion,                   
          petitioner filed its motion, and respondent filed its cross-                 
          motion, for partial summary judgment with respect to the                     
          threshold issue, along with supporting memoranda of law.                     
                                      Discussion                                       
               Petitioner asks us to find overpayments of taxes for its                
          1987, 1988, and 1989 tax years, respectively, based on its                   
          recomputation of the commissions payable to its foreign                      
          subsidiary, UCFSC, during those years pursuant to section 925(a)             
          and attendant regulations.  We have jurisdiction to determine the            
          amounts of any overpayments with respect to petitioner's 1987,               
          1988, and 1989 tax years since respondent has determined a                   
          deficiency for each of those years.  Sec. 6512(b); Barton v.                 
          Commissioner, 97 T.C. 548, 552 (1991).  We must first decide                 
          whether the Regulation precludes petitioner from claiming                    
          additional FSC commission expenses for the years in issue.  If we            
          hold that it does, we must then decide whether the Regulation is             
          valid.                                                                       




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