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especially true where, as is here, the fees relate solely to the
optional insurance of a liability and do not relate directly to
either a capital asset or to an income producing activity. Cf.
INDOPCO, Inc. v. Commissioner, 503 U.S. at 83-84 (capitalization
generally required to match an expense with the income to be
generated therefrom).
Respondent analogizes petitioner’s payment of the fees with
the purchase of a nontransferable membership interest, which,
respondent asserts, is a capitalizable expense. According to
respondent, Metrobank’s membership interest in the BIF entitled
it to: (1) A substantial reduction in future depository
insurance premiums, (2) the right to insure all of its deposits
in a more stable insurance fund, and (3) the need to adhere to
only one regulatory scheme. We disagree with respondent’s
analogy.9 First, as mentioned above, respondent makes no
assertion that Metrobank’s payment of either fee was related to
the purchase of a capital asset.10 Second, Metrobank was already
9 We recognize that title 12 uses the terms BIF member and
SAIF member to refer to the participants of those funds. See,
e.g., 12 U.S.C. sec. 1813(d) (1994). We do not understand
Congress’ use of the word “member” to refer to a membership
interest in the funds in the property sense of the word. In
fact, respondent has not even made such an argument.
10 In this regard, respondent relies incorrectly on
Darlington-Hartsville Coca-Cola Bottling Co. v. United States,
273 F. Supp. 229 (D.S.C. 1967), affd. 393 F.2d 494 (4th Cir.
1968), and Rodeway Inns of Am. v. Commissioner, 63 T.C. 414
(1974), to support his position herein. The taxpayer in each of
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