Tribune Publishing Co. And News Review Publishing Co., Inc. v. Commissioner of Internal Revenue

This is an appeal of a decision by the United States Tax Court, 79 T.C. 1029 , affirming a determination by the Commissioner of Internal Revenue (Commissioner) that the appellants were deficient in their federal income taxes for the years 1976, 1977, and 1978.

I. BACKGROUND

Appellants Tribune Publishing Co. (Tribune) and News Review Publishing Co., Inc. (News) are two Idaho corporations which operate daily newspapers out of Lewiston, Idaho, and Moscow, Idaho, respectively. Both appellants filed federal corporate income tax returns for the years in question. Tribune publishes a morning newspaper in Lewiston, named the Lewiston Tribune. News publishes an afternoon newspaper in Moscow, about 30 miles away, named the Daily Idahonian. Both papers serve the same general area and there are a significant number of readers who subscribe to both.

During the years in issue, Tribune was owned primarily by the members of the Alford family, several of whom served as corporate officers. Prior to 1967, News was owned and operated by the Marineau family. William Marineau (William) was the president and publisher and A.J. Mari-neau (A.J.) was the vice-president and general manager.

The Alfords…