- 3 -
the taxable years in issue, petitioner fulfilled his delivery
obligations to MCP with “pool” corn. MCP charged a flat per-
bushel service charge to members who fulfilled their delivery
obligations with “pool” corn.
MCP’s processing added value to the corn delivered by its
members. As a result, in addition to the payments and fees for
delivered corn, MCP made “value added” payments to its members
subsequent to each of the 3 required delivery periods. In
addition, MCP made discretionary yearend value-added payments
determined after the close of MCP’s fiscal year ending September
30. Such yearend value-added payments were not mandatory and
were based upon MCP’s “net proceeds”. Only yearend value-added
payments are before us.
Petitioner received a letter from MCP, dated August 30,
1995, which stated in pertinent part that the yearend value-added
payment for 1995 would “be determined after MCP’s annual audit
and paid out by mid-November.” The letter indicated that
petitioner could check a statement that he “would like” to have
his 1995 yearend value-added payment deferred until January 1996.
In the space above the deferral paragraph, the letter noted that
“Value added must still be reported as income on your tax forms.
Consult your tax advisor with any questions.”
On September 25, 1995, petitioner deferred his yearend
value-added payment for 1995 until January 1996. Petitioner
Page: Previous 1 2 3 4 5 6 Next
Last modified: May 25, 2011