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and 1996, the issue for decision is whether petitioner’s
deductions for expenses incurred in providing officers with
nonbusiness flights on a company-owned airplane are limited by
section 2741 to the amount reported as imputed income to the
recipient officers.
Background
The parties submitted this case fully stipulated. The
stipulation of facts and the attached exhibits are incorporated
herein by this reference. Petitioner is a corporation that had
its principal place of business in Oklahoma City, Oklahoma, at
the time it filed its petition.
For the period in issue, petitioner had fiscal years ending
July 31, 1995 and 1996. Petitioner also had a short taxable year
beginning August 1 and ending December 31, 1996. Petitioner
timely filed its Forms 1120, U.S. Corporation Income Tax Return,
for the years in issue. Petitioner uses the accrual method of
accounting for tax purposes.
Petitioner is principally engaged in the business of
providing financial services. Petitioner’s headquarters are
located in Oklahoma City, and, through its subsidiaries,
petitioner has retail bank locations throughout Oklahoma.
1Unless 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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