- 7 - its owner for federal tax purposes, effective immediately prior to the sale on * * * [June 30, 19973], until 60 days following the date of this letter.” Respondent, however, added the following caveat: no inference should be drawn from this letter that any gain from the sale of * * * [H&C’s] assets immediately following its election to be disregarded as an entity separate from its owner gives rise to gain that is not foreign personal holding company income as defined in section 954(c)(1)(B) of the Internal Revenue Code. On or about October 10, 1999, H&C made an election on Form 8832 to be disregarded as a separate entity. The Form 8832 specifies that the election is to be effective beginning June 30, 1997. Discussion I. Introduction This case presents an issue of first impression and, insofar as we are aware, the first occasion that any court has had to opine on the impact of the so-called check-the-box regulations on the application of a specific provision of the Internal Revenue Code of 1986 (the Code), in this case, section 954(c)(1)(B)(iii) (defining, in part, FPHCI).4 3 Based upon petitioner’s representation, that is the assumed date of the sale of the H&C stock by Dover UK. 4 There has, however, been much commentary concerning the issue before us today. E.g., Sheppard, “Behind the Eight Ball on Check-the-Box Abuses”, 101 Tax Notes 437 (Oct. 27, 2003); Yoder & Everson, “Check-and-Sell Transactions: Proposed Regulations (continued...)Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
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