Interlake Corporation - Page 14

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          or for the prior taxable year to which the NOL is carried.  See              
          sec. 6411(c).  Section 1.6411-4, Income Tax Regs.,                           
          cross-references section 1.1502-78, Income Tax Regs., for rules              
          applicable to consolidated groups.                                           
               Section 1.1502-78, Income Tax Regs., provides, in part, as              
                    (a)  General Rule.--If a group has a consolidated                  
               net operating loss, a consolidated net capital loss, or                 
               a consolidated unused investment credit for any taxable                 
               year, then any application under section 6411 for a                     
               tentative carryback adjustment of the taxes for a                       
               consolidated return year or years preceding such year                   
               shall be made by the common parent corporation to the                   
               extent such loss or unused investment credit is not                     
               apportioned to a corporation for a separate return year                 
               pursuant to �1.1502-79(a), (b), or (c).  In the case of                 
               the portion of a consolidated net operating loss or                     
               consolidated net capital loss or consolidated unused                    
               investment credit to which the preceding sentence does                  
               not apply, and in the case of a net capital or net                      
               operating loss or unused investment credit arising in a                 
               separate return year which may be carried back to a                     
               consolidated return year, the corporation or                            
               corporations to which any such loss or credit is                        
               attributable shall make any application under section                   
                    (b)  Special Rules.--(1) Payment of refund.  Any                   
               refund allowable under an application referred to in                    
               paragraph (a) of this section shall be made directly to                 
               and in the name of the corporation filing the                           
               application, except that in all cases where a loss is                   
               deducted from the consolidated taxable income or a                      
               credit is allowed in computing the consolidated tax                     
               liability for a consolidated return year, any refund                    
               shall be made directly to and in the name of the common                 
               parent corporation.  The payment of any such refund                     
               shall discharge any liability of the Government with                    
               respect to such refund. [Emphasis added.]                               
               The dispute in the instant case centers around the                      
          application of section 1.1502-78(b)(1), Income Tax Regs., with               

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Last modified: May 25, 2011