Unionbancal Corporation - Page 10

                                       - 10 -                                         

              In November 1984, respondent promulgated 1.267(f)-1T,                   
         Temporary Income Tax Regs., 49 Fed. Reg. 46992 (Nov. 30, 1984)               
         (the Temporary Regulation).  The Temporary Regulation provides               
         generally that consolidated return principles apply under section            
         267(f)(2) to the deferral and restoration of loss on the sale or             
         exchange of property between member corporations of a controlled             
         group.  See sec. 1.267(f)-1T(c)(1), Temporary Income Tax Regs.,              
         49 Fed. Reg. 46998 (Nov. 30, 1984).  As in effect for the years              
         in issue, the consolidated return rules for deferred intercompany            
         transactions generally defer a loss on a sale to another                     
         controlled group member and allow for the deferred intercompany              
         loss to be taken into account by the selling member upon the                 
         earliest of various specified dates.  See sec. 1.1502-                       
         13(c)(1)(i), (f)(1), Income Tax Regs.7  One such specified date is           
         the date immediately preceding the time when either the selling              
         member or the member which owns the property ceases to be a                  
         member of the controlled group.  See sec. 1.1502-13(f)(1)(iii),              
         Income Tax Regs.; see also Turner Broad. Sys., Inc. & Subs. v.               
         Commissioner, 111 T.C. 315, 334-337 (1998).                                  

               7  Sec. 1.1502-13, Income Tax Regs., as in effect in the               
          taxable year at issue was repromulgated in 1995 in T.D. 8597,               
          1995-2 C.B. 147, which also included the 1995 final regulations             
          under sec. 267(f).                                                          

Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  Next

Last modified: May 25, 2011