STAR: State Automated Tax Research for the State of Texas

7602H1005E11 [Tax Type: Franchise (PRIOR TO 01/01/2008)] [Document Type: Hearing]

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Texas Comptroller of Public Accounts STAR System

7602H1005E11

DECISION UPON: PETITION FOR A SPECIAL REPORTING METHOD IN RE: ********* ********* ********* PERMIT NO. ********* AUDIT NO.: PERIOD: 1972 Report TYPE OF TAX: Franchise HEARING NO. 5681 HEARING DATE: 8-3-72 Ms. Harriet D. Burke PRESIDING HEARINGS EXAMINER ********* ********* REPRESENTATIVE(S) FOR PETITIONER CONTENTION *********, Petitioner herein, filed a Petition for Equitable Apportionment dated May 31, 1972, under Article 12.02 alleging that the statutory allocation formula under Article 12.02(1) when applied to Texas did not distinguish between investment receipts and business receipts. The petition requested the use of any of the following special reporting methods: (1) use of an investment factor (2) filing on a consolidated or combined return (3) use of constructive gross receipts as an alternative to the inclusion of dividends in the allocation factor (4) the separation from taxable capital of the investments in and advances to subsidiaries and affiliates not doing business in Texas and the separation of investments in and advances to other subsidiaries and affiliates to the extent that the subsidiary and affiliate derives its gross receipts from business outside of Texas DISCUSSION A hearing was held on this Petitioner on August 3, 1972. Petitioner subsequently paid the 1972 return under protest and filed suit to recover the amount paid seeking to obtain one of the special reporting methods alleged in this hearing. (Texaco, Inc. v. Calvert, 526 SW2d 630 (Tex. Civ. App. 1975--Austin, writ ref. n.r.e.) The court rendered judgment for the State denying the application of the Plaintiff for an Alternative allocation formula. FINDINGS OF FACT The Examiner finds that the court in Texaco, Inc. v. Calvert, supra, denied Petitioner's application to use a special reporting method for the 1972 franchise tax return. CONCLUSION OF LAW The Examiner concludes that the decision of Texaco, Inc. vs. Calvert, supra, controls in this hearing. RECOMMENDATION The Hearings Examiner recommends that the Petition for Equitable Apportionment filed for the 1972 report should be denied based upon Texaco, Inc. v. Calvert, 526 SW2d 630 (Tex. Civ. App., 1975--Austin, writ ref. n.r.e.). Harriet D. Burke PRESIDING HEARINGS EXAMINER ORDER OF THE COMPTROLLER The Recommendations of the Hearings Examiner are approved and adopted in all respects. Given under my hand and in accordance with the provisions of the Texas Franchise Tax Act, this the 23rd day of February, 1976. BOB BULLOCK COMPTROLLER OF PUBLIC ACCOUNTS

ACCESSION NUMBER: 7602H1005E11
SUPERSEDED: N
DOCUMENT TYPE: H
DATE: 1976-02-23
TAX TYPE: FRANCHISE (PRIOR TO 01/01/2008)