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Tax Year Ended Deficiency
June 26, 1993 $432,619
Dec. 31, 1993 432,619
Dec. 31, 1994 432,619
Dec. 31, 1995 432,619
These deficiencies stem from respondent’s determination requiring
petitioner to recapture its LIFO reserves upon conversion from a C
corporation to an S corporation effective June 27, 1993.
The issue for decision is whether petitioner is subject to
LIFO recapture pursuant to section 1363(d) as a consequence of a
change in the structure of petitioner and its subsidiaries. For
the reasons set forth below, we hold that it is.
All section references are to the Internal Revenue Code as in
effect for 1993. All dollar amounts are rounded.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found. The
stipulation of facts and the attached exhibits are incorporated
herein by this reference.
Background
At the time the petition in this case was filed, Coggin
Automotive Corp., formerly known as Coggin-O’Steen Investment
Corp., was a Florida corporation with its principal place of
business in Jacksonville, Florida. (Herein, both Coggin Automotive
Corp. and Coggin-O’Steen Investment Corp. are referred to as
petitioner.)
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