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These cases were consolidated for trial, briefing, and
opinion.2 Petitioners include the following corporations:
Toyota Town, Inc.; Country Nissan, A California Corporation;
Quality Motor Cars of Stockton, A California Corporation; Bob
Wondries Motors, Inc., d.b.a. Wondries Ford; Wondries Nissan,
Inc.; and Bob Wondries Associates, Inc., d.b.a. Wondries Toyota;
as well as individual petitioners Robert S. and Christina Zamora
(Zamoras), who filed joint returns for the years in issue. The
Zamoras owned, during the years in issue, approximately 48
percent of the issued and outstanding shares of Wondries
Chevrolet, Inc. (Wondries Chevrolet), an S corporation within the
meaning of section 1361(a).3 For convenience, we shall
hereinafter refer to Wondries Chevrolet and the C-corporation
petitioners collectively as petitioners.
The issue for decision is the proper period for petitioners
to deduct insurance premium expense incurred in connection with
sales of extended warranty agreements to their customers.
2 In docket No. 4959-95, the adjustment relating to the 1991
taxable year is not in dispute. In docket No. 4960-95 only the
adjustments relating to the 1992 and 1993 taxable years have been
consolidated, and the adjustment relating to the 1991 taxable
year is not in dispute. In the remaining docket Nos., 4961-95,
22741-95, 1254-96, 1255-96, and 1256-96, all adjustments are
attributable to the common issue in dispute.
3 Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for the years in issue, and
all Rule references are to the Tax Court Rules of Practice and
Procedure.
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