- 3 - Petitioner claims overpayments of $57,775,538 for 1987, $28,434,990 for 1988, $32,577,346 for 1989, and $19,504,333 for 1990. In this Opinion, we decide whether certain nonrefundable commitment fees that mortgage originators paid to petitioner to enter into Conventional Multifamily Prior Approval Purchase Contracts (prior approval purchase contracts) are to be recognized when those fees are paid or should be treated as premium for “put” options, which would defer recognition until after delivery or nondelivery of the underlying mortgages.1 This issue is one of several involved in these cases.2 Background The parties submitted this issue fully stipulated pursuant to Rule 122.3 The stipulations of fact and the attached exhibits are incorporated herein by this reference. At the time it filed the petitions, petitioner maintained its principal office in 1 The adjustments proposed in the notices of deficiency for 1985 through 1990 pertaining to the commitment fee issue included a small amount of commitment fees related to single-family optional delivery mixed in with the prior approval program. The parties have since resolved the commitment fee issue as to the single-family program. 2 See Fed. Home Loan Mortgage Corp. v. Commissioner, 121 T.C. 129; 121 T.C. 254; 121 T.C. 279 (2003); T.C. Memo. 2003-298. 3 All 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.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011