Hyatt Hotels Corporation & Subsidiaries v. Commissioner of Internal Revenue

Petitioner challenged a determination by the Internal Revenue Service that certain income that was paid into a loyalty program fund should have been reported as income to the petitioner. The tax court agreed with the IRS and petitioner appealed to the Seventh Circuit, arguing that the payments to the fund weren’t the hotel’s income and, if they were, then the hotel should be allowed to use the trading stamp method of tax accounting to offset that income by associated costs. The Seventh Circuit vacated the tax court’s decision, finding that its analysis was incomplete when it considered whether the payments into the fund were the hotel’s income and remanded for further proceedings. (JACKSON-AKIWUMI and MALDONADO, concurring)