Likins-Foster Honolulu Corp. v. Commissioner Internal Revenue Service

840 F.2d 642 61 A.F.T.R.2d 88 -660, 88-1 USTC P 9187 LIKINS-FOSTER HONOLULU CORP.; Aliamanu Homes, Ltd.; Likins-Foster Topeka Corp.; Likins-Foster Salinas Corp.; Limita Homes, Inc.; Cardiff Homes, Inc., etc., et al., Petitioners-Appellants, v. COMMISSIONER INTERNAL REVENUE SERVICE, Respondent-Appellee. No. 87-7001. United States Court of Appeals, Ninth Circuit. Argued and Submitted Nov. 9, 1987. Decided Feb. 17, 1988. Valentine Brookes and Lawrence V. Brookes, Brookes & Brookes, San Francisco, Cal., for petitioners-appellants. Michael L. Paup, Jonathan S. Cohen and Kenneth L. Greene, Tax Div., U.S. Dept. of Justice, Washington, D.C., for respondent-appellee. Appeal from a Decision of the Tax Court of the United States. Before GOODWIN and FLETCHER, Circuit Judges, and KING, * District Judge. GOODWIN, Circuit Judge: 1 Taxpayers appeal from a decision of the United States Tax Court, 50 T.C.M. (CCH) 1465 (1985), upholding the Commissioner's allocation, under I.R.C. Sec. 482 (1984), of interest income to Likins-Foster, parent corporation, as a result of interest-free loans made by it to its subsidiary. We affirm. 2 Likins-Foster Honolulu Corporation, a cash basis taxpayer, is the…