- 51 -
That statement was made in response to the taxpayer’s
argument to the effect that the Commissioner’s allocation
of certain general and administrative expenses, as called
for in the amendment to answer, was not a change of method
of accounting under Standard Oil Co. (Indiana) v.
Commissioner, supra, because the taxpayer was required by
the regulations to allocate those costs to long-term
contracts and did not have a “discretionary choice” to do
otherwise.
Other than the above statement, we find nothing in
Tex. Instruments that is useful to petitioner in this case.
As we read the Court’s opinion in Tex. Instruments, the
statement quoted above is dictum. Furthermore, the
statement was made about adjustments proposed by the
Commissioner, as to which section 446(e) does not apply.
See Complete Fin. Corp. v. Commissioner, 80 T.C. 1062, 1073
(1983) (“The restriction of section 446(e) does not apply
to changes initiated by the Commissioner.”), affd. 766 F.2d
436 (10th Cir. 1985). Finally, the above statement is
nothing more that a reprise of the Court’s holding in
Standard Oil Co. (Indiana), a case which, as discussed
below, is unlike petitioner’s.
Petitioner’s reliance on the last case cited, Standard
Oil Co. (Indiana), is also misplaced. In that case, the
Page: Previous 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 NextLast modified: May 25, 2011