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Appeals for the Fourth Circuit and the Board not to include any
timely filing requirement.
Petitioner argues that section 882(c)(2) does not contain a
timely filing requirement and that the disputed regulations are
invalid as inconsistent with that section.5 Respondent argues
that section 882(c)(2) provides clearly that a foreign
corporation must file its return timely in order to deduct its
expenses and that the disputed regulations are a proper
interpretation of that provision. Respondent asks the Court now
to accept his interpretation, which he acknowledges is the same
as that rejected in Anglo-Am. Direct Tea Trading Co. v.
Commissioner, supra, and its progeny, and to disavow all contrary
interpretations expressed by the Court of Appeals for the Fourth
Circuit and the Board.
We agree with petitioner that section 882(c)(2) does not
contain a timely filing requirement and that the disputed
regulations are invalid to the extent discussed herein. We hold
that petitioner may deduct its expenses. On the basis of our
holding and a concession by respondent that section 6651(a) is
inapplicable if petitioner is entitled to deduct its expenses, we
also hold without further discussion that petitioner is not
5 Petitioner also makes numerous other arguments which are
pertinent only if the disputed regulations are valid. Given our
holding herein that the disputed regulations are invalid, we need
not and do not decide any of petitioner’s other arguments.
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