[Download] "Fieldcrest Mills Inc. v. Coble" by Supreme Court of North Carolina No. 67 * Book PDF Kindle ePub Free

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eBook details

• Title: Fieldcrest Mills Inc. v. Coble
• Author : Supreme Court of North Carolina No. 67
• Release Date : January 01, 1976
• Genre: Law,Books,Professional & Technical,
• Pages : * pages
• Size : 69 KB

Description

The facts of the present case can be reduced to the following formula. ""A,"" a parent corporation, incorporates ""B,"" a wholly owned subsidiary, to perform a vital manufacturing service required by ""A"" corporation in its own production. ""B"" not only provides the service to ""A"" corporation, but 40% of its business is conducted with others. The two corporations operate as parent and subsidiary, filing separate state income tax returns as required by state law and consolidated income tax returns as permitted by federal law. After ""B"" experiences net operating losses for a couple of years it is merged into ""A"" corporation in a totally tax-free reorganization. Thereafter ""A"" corporation conducts the same businesses the separate corporations had previously conducted. In the year following the merger the division of ""A"" corporation, which was formerly ""B"" corporation, continued to operate at a loss. On ""A's"" post-merger federal income tax return, however, the pre-merger net operating loss attributable to ""B"" corporation is allowed as a carryover deduction under § 381 of the Internal Revenue Code (I.R.C.) of 1954 and is used to offset post-merger income generated by the previous assets of ""A"" corporation.

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