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On September 30, 1993 (through a series of section 351
transfers involving a number of entities related to and
controlled generally by Wolf and through which Atrium ultimately
received stock in a corporation related to petitioner),6 Atrium
transferred to petitioner Atrium’s remaining interests and
obligations relating to the underlying Brussels Leaseback, the
Atrium Sublease, and the Trust Fund. The interests transferred
to petitioner included the potential right to receive the
unspecified payments from ABN under the RVC and the stated
obligation to make the restructured additional $400,000 payment
into the Trust Fund. This transfer to petitioner was the first,
direct step in the plan to generate the multi-million dollar
ordinary tax deductions that petitioner sought to use as an
offset against, among other income, the $11 million that
petitioner would be required to recognize on its 1994 U.S.
Corporation Income Tax Return (Form 1120) as a result of the sale
to Loral of Quintron’s assets.
As the second, direct, prearranged step in the plan to
generate for petitioner the above-referenced multi-million dollar
tax deduction, also on September 30, 1993, simultaneously with
petitioner’s receipt from Atrium of the above interests relating
6 For convenience, we do not specifically identify each and
every entity related to and generally controlled by Wolf which
participated in the various transactions involving the transfer
of the leases and the interest in the Trust Fund.
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Last modified: May 25, 2011