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the taxpayer, chartered as an industrial loan corporation under
Virginia State law, qualified as a bank within the meaning of the
Revenue Act of 1936, ch. 690, sec. 104, 49 Stat. 1677. Although
Virginia State law made a distinction between industrial loan
corporations and banks, the court noted that “peculiarities in
individual state laws” are not controlling in the interpretation
of section 104. Staunton Indus. Loan Corp. v. Commissioner,
supra at 933. After analyzing the “sum total of * * *
[taxpayer’s] business activities”, the court concluded that the
taxpayer functioned as a bank that Congress intended to include
for purposes of section 104. Id. Similarly, in Mut. Sav. & Loan
Co. v. Commissioner, 44 B.T.A. 1204 (1941), although the taxpayer
was organized as an industrial loan association and not a bank
under State law, the substance of its activities qualified for
treatment as a bank within the meaning of the Revenue Act of
1936, ch. 690, sec. 104, 49 Stat. 1677. In both cases, the Court
rejected State law distinctions between banks and other entities
when at odds with the definition of a bank under the Federal
statute. Petitioner urges that, under the Staunton and Mutual
approach, Southwest and Pinellas continue to qualify as domestic
building and loan associations because they functioned the same
before and after the mergers and meet the supervisory test,
business operations test, and assets test of section 7701(a)(19).
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