Transamerica Corp. v. United States
Opinion
Opinion
Henderson, J.
ORDER
This matter comes before the court on cross-motions for summary judgment on plaintiff’s claim for a tax refund for the years 1971 through 1974. Few, if any, facts are in dispute. The sole question for the court to determine is whether plaintiff was entitled to include in its basis for motion picture films in the years in question the estimated future participation and residual payments to be made to the films’ performers, creators and various unions out of the proceeds from ticket sales to the general public. For the reasons stated below, the court concludes that plaintiff should not have included these payments in its basis and thus was not entitled to the full depreciation deductions claimed.
I. FINDINGS OF FACT
Most of the facts in this matter have been stipulated to by the parties.
1. Transamerica (“Taxpayer”) is, and at all material times has been, a Delaware corporation with its principal place of business in the City and County of San Francisco, California. Transamerica filed its consolidated federal income tax returns for the years 1971 to 1973 with the District Director of Internal Revenue for the District of San Francisco. During each of those years, United…