- 10 -
(1974), affd. without published opinion 510 F.2d 970 (3d Cir.
1975).
Alternatively, both parties dispute the effect of bankruptcy
proceedings that Daniel initiated in 1985 on the claimed net
operating loss, investment interest, and investment credit
carryovers. On July 17, 1985, Daniel filed a petition with the
Bankruptcy Court for the Southern District of Illinois under
Chapter 11 of the Bankruptcy Code. 11 U.S.C. sec. 1101 (1988).
On December 12, 1985, Daniel's bankruptcy case was converted to a
Chapter 7 bankruptcy. 11 U.S.C. sec. 701 (1988). On March 19,
1986, the Bankruptcy Court entered a discharge order in Daniel's
bankruptcy case (thereby terminating as of the date of the
discharge any stay that would have been in effect with regard to
this Tax Court proceeding under 11 U.S.C. section 362(a)(8)
(1988)), and in 1995 Daniel's bankruptcy case was closed.
Under section 1398(g)(1) and (4), the bankruptcy estate of
Daniel would have succeeded to any net operating loss, investment
interest, and investment credit carryovers to which Daniel would
have been entitled. Any such carryovers that Daniel could
substantiate and to which Daniel would have been entitled at the
time the bankruptcy petition was filed, determined as of the
first day of January 1985 (the year in which petitioner filed for
bankruptcy), would have remained with the bankruptcy estate until
the bankruptcy estate terminated in 1995. Sec. 1398(i).
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