Court Opinion

ID: 855545
Source: CourtListenerOpinion
Date Created: 2013-03-19 16:46:58.15663+00
Date Added: 2024-06-11T09:11:10.226294
License: Public Domain

PRECEDENTIAL
    UNITED STATES COURT OF APPEALS
         FOR THE THIRD CIRCUIT
              _____________

                 No. 12-2275
                _____________

               NEAL CRISPIN,
                            Appellant,
                    v.

  COMMISSIONER OF INTERNAL REVENUE,

               _______________

   On Appeal from the United States Tax Court
                (No. 28980-07)
         Judge: Hon. Diane L. Kroupa
               _______________

                    Argued
                January 8, 2013

Before: RENDELL, FISHER, and JORDAN, Circuit
                  Judges.

            (Filed: March 19, 2013)
               _______________
George W. Connelly [ARGUED]
Chamberlain, Hrdlicka, White, Johnson & Williams
1200 Smith Street
1400 Citicorp
Houston, TX 77002
     Counsel for Appellant

Gary R. Allen
Tamara W. Ashford
Richard Farber
Judith A. Hagley [ARGUED]
Gilbert S. Rothenberg
United States Department of Justice
Tax Division
950 Pennsylvania Avenue, NW
P.O. Box 502
Washington, DC 20044
                     _______________

              ORDER AMENDING OPINION
                  _______________

JORDAN, Circuit Judge.

      IT IS NOW ORDERED that the above-captioned
opinion be amended as follows:

Footnote 3 shall now read:

      The Commissioner contends that that step in the
      CARDS transaction “is predicated on an invalid
      application of the ... basis provisions of the
      Internal Revenue Code.” (Appellee’s Br. at 4.)

                             2
     Specifically, I.R.C. § 1012 provides that a
     taxpayer’s basis in property is generally equal
     to the purchase price paid by the taxpayer. That
     purchase price includes the amount of the
     seller’s liabilities assumed by the taxpayer as
     part of the purchase, on the assumption that the
     taxpayer will eventually repay those liabilities.
     See Comm’r v. Tufts, 461 U.S. 300, 308-09
     (1983). But in a CARDS transaction, the
     Commissioner argues, the taxpayer and the
     foreign borrower agree that the taxpayer will
     repay only the portion of the loan equal to the
     amount of currency the taxpayer actually
     purchases.

                                 /s/ Kent A. Jordan
                                Circuit Judge

DATED: March 19, 2013

                            3