Firms that constitute a "unitary business group" can file a consolidated tax return, but there has to be some integration of the subsidiaries beyond sharing a parent corporation. Environdyne Industries, Inc. is the parent company of several subsidiaries that make food packaging materials and other subsidiaries that make steel. Environdyne filed a consolidated tax return for both subsidiaries, and the Illinois Department of Revenue filed a claim in bankruptcy court claiming additional taxes were owed by Environdyne. The Department of Revenue concluded that Environdyne was not authorized to include the losses of the steel subsidiaries in its consolidated returns. The purpose of the consolidated tax return is to assist those companies that do business across state lines and cannot separate revenues into specific states. There has to be some integration of the business beyond the subsidiaries sharing a common parent corporation where the members of the unitary business group must depend on and contribute to each other. Therefore, one affiliate cannot use the other subsidiary™s losses to reduce its own tax liability. In re Environdyne Industries, Inc., No. 02-1632, 2004 U.S. App. LEXIS 69 (7th Cir. Jan. 6, 2004).
