Recently, the tax court in Hoover Company v. Commissioner,’ re- fused to apply the Corn Products doctrine3 and found that a corpora- tion’s forward sales agreements in foreign currencies were not hedging agreements.4 The court concluded that such sales did not constitute an integral part of the business,5 and thus losses from such transactions fell outside the protection of Corn Products and were afforded capital treat- ment.6 This note will suggest that the Hoover court, in focusing its deci- sion on the form of the taxpayer’s transaction (i.e., whether it was a “bona fide” hedge), failed to properly apply the “integral part of busi- ness” doctrine.
