- 14 -
1958). Second, the Instructions to Forms 1120 and 1120-A, U.S.
Corporation Income Tax Return, Codes for Principal Business
Activity, for 1990-95 require a corporation to report on its tax
return its business activity from which it derives its largest
percentage of total receipts, not the business activity
authorized in its articles of incorporation.
We conclude that FabuGlass correctly reported that it was an
investment company in 1990-95.
c. Whether FabuGlass Operated in Russia in 1990-94
Petitioners contend that FabuGlass was largely an operating
company in 1990-94 because it operated in Russia in those years.
Petitioner testified that FabuGlass tried to sell armored
vehicles and refrigeration trucks to Russian companies. However,
his testimony on this point was vague. The record shows that
AmRuss, and not FabuGlass, tried to do business in Russia.
Sawyer, who prepared FabuGlass’ original income tax returns for
1990-95, testified that he did not know that FabuGlass was trying
to do business in Russia, but that AmRuss did try to do business
there. He testified that he and petitioner considered doing
business in Russia in 1992 or 1993 on behalf of a company called
AmRuss.
Petitioners contend that Exhibit 39-P, a contract dated
December 22, 1994, shows that FabuGlass was operating in Russia
in 1994. We disagree. Exhibit 39-P is a contract in which Bank
Baltisky agreed to buy an armored vehicle from AmRuss. FabuGlass
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