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accounting. See Schmidt Baking Co. v. Commissioner, 107 T.C. 271
(1996); see also Chalmette Gen. Hosp., Inc. v. United States,
71 AFTR 2d 93-3314, 90-2 USTC par. 50,578 (E.D. La. 1990).
See generally Utz, 384-2nd T.M., Restricted Property--Section 83
A-15-16 (1996).
Petitioner argues that section 1.83-6(a)(3), Income Tax
Regs., the two cases cited immediately above, and Robinson v.
Commissioner, 82 T.C. 444 (1984), support its right to a
deduction in 1988, the year in which the amount is deductible
under its accrual method, notwithstanding the fact that its
employees did not include any of the subject amount in income.
We do not agree. As discussed above, section 1.83-6(a)(3),
Income Tax Regs., does not independently bestow a deduction on
petitioner with respect to its transfer of the Endotronics stock.
Moreover, petitioner's reliance on Schmidt Baking Co., Chalmette
Gen. Hosp., and Robinson is misplaced. None of the Courts in
those cases addressed or decided the issue that is before us
today. Nor did the parties in those cases, unlike the parties
here, dispute that the employers were entitled to a deduction,
challenging only the timing of that deduction.
In summary, petitioner has not met the requirements for
deductibility under section 83(h), and it has not met the
requirements for deductibility under section 1.83-6, Income Tax
Regs., either pre- or post-amendment. Thus, section 83(h)
prevents petitioner from deducting the value of the transferred
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