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sale of real property, a tax forfeiture of real property, a
conveyance of real property to a mortgagee by quitclaim deed in
lieu of foreclosure, a decline in the value of real property
below the amount of nonrecourse debt associated with the property
combined with a conveyance of the property by quitclaim deed to
the mortgagee, an abandonment of property subject to nonrecourse
debt, relief from indebtedness associated with property, and
extinguishment of a taxpayer's right of redemption following a
foreclosure sale of property may all be treated as a sale or
exchange triggering realization of gain or loss relating to
property. Commissioner v. Tufts, supra at 308-309; Helvering v.
Nebraska Bridge Supply & Lumber Co., 312 U.S. 666 (1941);
Helvering v. Hammel, 311 U.S. 504, 511 (1941); Yarbro v.
Commissioner, 737 F.2d 479, 485-486 (5th Cir. 1984), affg. T.C.
Memo. 1982-675; Laport v. Commissioner, 671 F.2d 1028, 1033-1034
(7th Cir. 1982), affg. T.C. Memo. 1980-355; R. O'Dell & Sons Co.
v. Commissioner, 169 F.2d 247, 248 (3d Cir. 1948), affg. 8 T.C.
1165 (1947); Lockwood v. Commissioner, 94 T.C. 252, 260 (1990);
Allan v. Commissioner, 86 T.C. 655, 659-660 (1986), affd. 856
F.2d 1169 (8th Cir. 1988); Middleton v. Commissioner, 77 T.C.
310, 320-321 (1981), affd. per curiam 693 F.2d 124 (11th Cir.
1982); Freeland v. Commissioner, 74 T.C. 970, 981-983 (1980);
Belcher v. Commissioner, T.C. Memo. 1965-1; sec. 1.1001-2(a),
Income Tax Regs.
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