Jacob and Chana Pinson, et al. - Page 14




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          II.  Respondent’s Motion for Reconsideration                                
               Having disposed of petitioners’ motions, we next turn our              
          attention to respondent’s motion for reconsideration.  In our               
          memorandum opinion, we considered the characterization, and                 
          corresponding tax treatment, of two types of payments received by           
          petitioners from FIL:  (1) Payments made directly to certain of             
          petitioners (termed “special commissions”), and (2) payments made           
          to a partnership and reported by certain of petitioners as their            
          distributive shares of partnership income.  We refused to accept            
          petitioners’ argument that these amounts were in substance                  
          dividends and should be treated as such for tax purposes.  In so            
          doing, we highlighted a number of representations contained in              
          the record which convinced us that both types of payments must be           
          treated as compensation.  Included amongst those representations            
          was petitioners’ designation of the payments on their Forms 1116            
          as “General limitation income”.  We further cited the general               
          rule that compensation would be identified for purposes of this             
          form as “General limitation income” while dividends would                   
          typically be placed in the “Passive income” category.                       
               Against this background, respondent states on motion that              
          petitioners’ Form 1116 reporting is consistent with our holding             
          that the payments are properly characterized as consulting or               
          compensation income.  However, respondent asks us to clarify that           
          petitioners’ classifying of the payments from FIL as general                






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