Court Opinion

ID: 4473026
Source: CourtListenerOpinion
Date Created: 2020-01-14 19:35:02.909982+00
Date Added: 2024-06-11T14:53:50.098342
License: Public Domain

Foley, J., concurring in result only: I agree with the majority’s holding. Section 108(d)(7)(A) explicitly provides that subsections (a), (b), (c), and (g) of section 108 are to be applied at the corporate level. I write separately to emphasize that after the application of section 108(b) and the resulting reduction of tax attributes (i.e., MAl’s net operating loss) there are no “items of income”, tax exempt or otherwise, to which section 1366(a) may apply. The legislative history accompanying the Bankruptcy Tax Act of 1980 states that after a taxpayer reduces its tax attributes, “Any further remaining debt discharge amount is disregarded, i.e., does not result in income or have other tax consequences.” S. Rept. 96-1035, at 2 (1980), 1980-2 C.B. 620, 621. Thus, there are no “items of income”, and, as a result, no basis adjustment pursuant to section 1367. Accordingly, there is no need to distinguish between “tax-exempt” and “deferred” income. Swift, Parr, Whalen, and Colvin, JJ., agree with this concurring in result only opinion.