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purposes of determining ownership under section 448(d)(2)(B) by
the shares listed on Schedule E of Form 1120, as that Form only
solicits information regarding the ownership of stock by
officers of the corporation in relationship to each other and
not the corporation’s full stock-ownership profile. Second,
petitioner argues that its treasury shares should be
characterized as “by value” pursuant to section 1.448-
1T(e)(5)(i), Temporary Income Tax Regs., supra, because under
New York law, the shares were acquired and retained by the
corporation, and the amount that they were acquired for
($53,999) establishes a present value to the corporation. We
disagree.
Petitioner’s argument that it did not include treasury
shares on Schedule E of the Form 1120 because Schedule E only
asks for shares held by corporation officers “in relation to one
another” is incorrect and meritless. While Schedule E does
solicit information with respect to the shares held by officers,
it clearly asks in sections (d) and (e) for the percentage of
total corporation stock owned by each officer. The corporation
is asked to provide the percentage of the total stock owned by
the officers and not, as petitioner argues, the percentages of
stock each owns in relationship to the other. Accordingly,
petitioner correctly indicated on its Forms 1120 for 2002 and
2003 that Mr. Apgar and Mr. Oliver together owned 100 percent of
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