Commissioner v. Bollinger, 485 U.S. 340 (1988)
Commissioner v. Bollinger is a cornerstone Supreme Court case in federal income tax law addressing when a corporation's separate existence may be disregarded because it serves only as a bona fide agent or nominee for its owners.
Whether a corporation that holds title to property pursuant to a genuine agency/nominee arrangement may be disregarded for federal tax purposes so that the income, deductions, and losses attributable to the property are taxed to the principal (here, the partnerships) rather than to the corporation.
A corporation is ordinarily a separate taxable entity (Moline Properties v. Commissioner), but it may be treated as a mere agent of its owners for federal tax purposes when there is a genuine, disclosed agency relationship. Under Commissioner v. Bollinger, a corporation will be disregarded as a separate taxpayer with respect to a particular asset if: (1) the fact that the corporation is acting as agent for its owners with respect to the specific property is set forth in a written agreement executed at or before the time the property is acquired; (2) the corporation functions as an agent and not as a principal with respect to the property for all purposes; and (3) the corporation is held out as the agent, and the owners as the principals, in all dealings with third parties concerning the property. National Carbide's factors inform, but do not negate, this bona fide agency exception.
Yes. The Supreme Court held that the title-holding corporations were bona fide agents/nominees of the partnerships, and thus the partnerships—not the corporations—were the owners for federal tax purposes with respect to the properties. The partnerships were entitled to the associated income, deductions, and losses.
Bollinger creates a clear, administrable safe harbor for disregarding a corporation that serves solely as a title-holding agent. It reconciles Moline Properties' respect for corporate form with the reality that lenders or regulators may require title to be held in a corporation even when the economic owner is a partnership. For students and practitioners, the case is central to understanding nominee/agency structures, preventing inadvertent entity-level taxation, and structuring real estate and financing transactions. It underscores that documentation, consistent conduct, and third-party disclosure are critical to ensure the intended tax treatment.