- 3 -
operated commercial enterprises, which rented consumer durables
(appliances, furniture, televisions, stereos, and video cassette
recorders) under rent-to-own leases to individuals.
In ABC Rentals, Inc. v. Commissioner, T.C. Memo. 1994-601
(ABC Rentals I), we determined that petitioners failed to
demonstrate that the consumer durables, leased in their rent-to-
own businesses, constitute property which is properly depreciable
under the income forecast method of depreciation. That opinion
was appealed to both the Fifth Circuit and the Tenth Circuit. El
Charro TV Rental, Inc., appealed to the Court of Appeals for the
Fifth Circuit. The Court of Appeals for the Fifth Circuit
affirmed our decision without published opinion. See ABC
Rentals, Inc. v. Commissioner, T.C. Memo. 1994-601, affd. without
published opinion sub nom. El Charro TV Rental, Inc. v.
Commissioner, 79 F.3d 1145 (5th Cir. 1996).
Petitioners in the instant case4 appealed to the Tenth
4During the taxable periods at issue in the underlying case,
Guaranteed Rental Systems, Inc. (Guaranteed), was an S
corporation and all of its adjustments flowed directly through to
the shareholders’ tax returns and were reflected in the
deficiencies shown in docket Nos. 20690-91 and 20691-91. For the
fiscal year ending May 31, 1987, ABC Rentals of San Antonio, Inc.
(ABC) was a C corporation, and the notice of deficiency in docket
No. 20689-91 related to deficiencies during that fiscal year
only. Thereafter, ABC applied for and was granted S corporation
status. For the tax period ending Dec. 31, 1987, and the tax
year ending Dec. 31, 1988, ABC was a non-TEFRA S corporation, and
all of ABC’s adjustments flowed through to its sole shareholder,
John P. Parsons, and were reflected in the deficiencies shown in
docket No. 20691-91.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 Next
Last modified: May 25, 2011