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Longmont firm balks at $923,049 tax bill
WASHINGTON - Whether Colorado Gas Compression Inc., is subject to capital gains taxes became an issue for the U.S. Tax Court here to resolve.
The Longmont-based oil and gas well operator filed a petition asking the court to overturn an Internal Revenue Service demand for $923,049 in additional taxes for 1994-96 on the sale of some assets.
The petition claimed that "as a matter of law" the company is not subject to capital gains taxes under the IRS Code because it is incorporated as an S corporation. S corporations are not subject to tax on their income, but their owners are.
"We've been caught like …