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participating in the BIF program before the transaction, and
Metrobank could have continued its participation in the BIF
program had it not consummated the transaction. Third, new banks
are not charged either fee to insure their deposit liabilities
with the BIF, nor is either fee imposed when a bank assumes the
deposit liabilities of another bank. Fourth, the fees were
nonrefundable, and any perceived benefit derived from Metrobank
from its payment of the fees would have been extinguished
completely had Metrobank terminated its FDIC insurance.
We conclude and hold that the fees are currently deductible.
In so concluding, we note that respondent does not argue that the
facts at hand are similar to the facts of Commissioner v. Lincoln
Sav. & Loan Association, 403 U.S. 345 (1971).11 Nor do we find
that such is the case. Whereas the payments in the Lincoln
Savings case served to create or enhance for the taxpayer a
separate and distinct asset, to wit, a “distinct and recognized
property interest in the Secondary Reserve”, id. at 354-355, the
payments here did no such thing.
10(...continued)
those cases purchased a capital asset incident to the payment of
the expenses in dispute there.
11 In fact, respondent does not even mention Commissioner v.
Lincoln Sav. & Loan Association, 403 U.S. 345 (1971), in his
brief.
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