- 4 -
Fiscal Year EA1 EAPR
1993 $65,000 $4,519
1994 65,000 7,739
1995 1,450,000 --
1 EA claims these amounts as minimum overpayment amounts.
The issues for decision under petitioners’ motion for
partial summary judgment are as follows:
(1) Whether EAPR was engaged in the active
conduct of a trade or business in Puerto Rico during
the years in issue and was entitled to section 936
possessions tax credits for these years. (This issue
affects both dockets.)
(2) If yes, then whether EAPR had a significant
business presence in Puerto Rico, with respect to the
manufacture3 of standardized video game cartridges
(hereinafter sometimes referred to as video games),
during the years in issue so as to entitle EAPR to
elect to use the profit split method in lieu of the
general rule of section 936(h)(1). Subsidiary
questions are (a) whether the video games were
3The statute uses the phrase “manufactured or produced”.
The parties’ stipulations in 12 instances refer to the video
games as having been “manufactured” and in 2 instances as having
been “produced”. It is not clear what is the congressionally
intended difference between “manufactured” and “produced”. The
Court does not discern any difference that would have
consequences for the instant cases, and, so far as we can tell
neither do the parties.
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Last modified: May 25, 2011