o (A) NOL – net operating loss for the taxable year of the discharge and any NOL carryover to the year of discharge o (B) General Business Credit – Carryover to or from taxable year of discharge an amount for purposes of determining the amount allowable as a credit under § 38 (relating to general business credit) o (C) Minimum Tax Credit – amount of minimum tax credit available at the beginning of the taxable year immediately following the discharge 13
o (D) Capital Loss Carryovers – net capital loss for the taxable year of the discharge and any carryover o (E) Basis Reduction (i) Basis of the property of the taxpayer (ii) For provisions for making the reduction, see §1017 o (F) Passive activity loss and credit carryovers – under § 469(b) o (G) Foreign Tax Credit Carryovers – carryovers to or from taxable year of discharge under § 27 (b)(3) Amount of reduction o (A) Dollar for dollar, except as in (2)(B) o (B) Credit carryover reduction – reductions in (B), (C), and (G) shall be 33 1/3 cents for each dollar excluded by subsection (a). Reduction described in subparagraph (F) in any passive activity credit carryover shall be 33 1/3 cents for each dollar excluded by subsection (a) (b)(4) Ordering rules o (A) Reductions made after determination of tax for the year o (B) Under (2)(A) or (D) shall be made first in loss for taxable year of discharge and then in carryovers o (C) Under (2)(B) or (G) made in order in which carryovers taken into account (b)(5) Election to apply reduction first against depreciable property (c) Treatment of discharged of qualified real property business indebtedness o (1) Basis reduction (A) Amount excluded under (a)(1)(D) applied to reduce basis of depreciable real property of t/p (B) Cross reference - §1017 o (2) Limitations (A) Indebtedness in excess of value – amount excluded shall not exceed excess of (i) Outstanding principal of indebtedness over (ii) FMV, reduced by outstanding principal amount of any other qualified real property business indebtedness (B) Overall limitation – (a)(1)(D) amount can’t exceed aggregate AB of depreciable real property held by t/p immediately before discharge o (3) Qualified real property business indebtedness o (4) Qualified acquisition indebtedness o (5) Regulations §108 (d) Meaning of terms; special rules relating to certain provisions o (d)(1) Indebtedness of taxpayer means any indebtedness: (A) For which the taxpayer is liable, OR (B) Subject to which the taxpayer holds property. o (d)(2) Title 11 Case means a case under title 11 of the U.S.C. (relating to BK), only if taxpayer is under jurisdiction of the court and the discharge is granted by the court or is pursuant to a plan approved by the court o (d)(3) Insolvent means the excess of liabilities over the FMV of assets, based on the taxpayer’s assets and liabilities immediately before the discharge o (4) Repealed o (5) Depreciable property – same meaning as in §1017 o (6) In case of PS, (a), (b), (c) and (g) applied at PS level o (7) Special Rules for S Corps.
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- Spring '14