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Petitioner and respondent filed cross-motions for partial
summary judgment under Rule 1211 on the issue of whether
petitioner’s election under section 177 to amortize certain
trademark and trade name expenditures, which were incurred in
1983 and 1984 when petitioner was tax exempt, was valid where the
election was filed with petitioner’s Federal income tax return
for its first taxable year commencing January 1, 1985.
Background
Some of the facts have been stipulated and are so found.
The stipulation of facts and the attached exhibits are
incorporated herein by this reference. At the time of filing the
petition, petitioner’s principal office was located in McLean,
Virginia. At all relevant times, petitioner was a corporation
managed by a board of directors.
Petitioner was chartered by Congress on July 24, 1970, by
the Emergency Home Financing Act of 1970, Pub. L. 91-351, title
III (Federal Home Loan Mortgage Corporation Act), 84 Stat. 451.
Petitioner was originally exempt from Federal income taxation.
However, Congress repealed petitioner’s Federal income tax
exemption status in the Deficit Reduction Act of 1984 (DEFRA),
Pub. L. 98-369, sec. 177, 98 Stat. 709. Pursuant to this act,
1All Rule references are to the Tax Court Rules of Practice
and Procedure, and all section references are to the Internal
Revenue Code in effect for the taxable years in issue.
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Last modified: May 25, 2011