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cost basis in the intangible asset. See sec. 1.1053-1(a), Income
Tax Regs.
We fail to see why these same principles are not analogous
to petitioner’s situation. Congress provided a special adjusted
basis for purposes of determining any gain on petitioner’s
property held as of January 1, 1985. Certainly, Congress was
aware of the rules that developed from the enactment of the
Federal income tax on March 1, 1913, recognized the potential of
a similar application with respect to tangible depreciable
property, and provided a special exception for such property but
did not provide a special exception for intangible property.
This contradicts respondent’s suggestion that Congress could not
have intended the use of a fair market value basis with respect
to petitioner’s alleged intangibles.
Respondent suggests that petitioner’s situation is more
analogous to provisions that pertain to the adjusted basis of
assets belonging to previously exempt organizations. Respondent
points to the repeals of tax exemption for the Blue Cross and
Blue Shield organizations in the Tax Reform Act of 1986, Pub. L.
99-514, sec. 1012(b), 100 Stat. 2391, and for the Teachers
Insurance Annuity Association and College Retirement Equities
Fund in the Taxpayer Relief Act of 1997, Pub. L. 105-34, sec.
1042, 111 Stat. 939. Unlike DEFRA section 177(d)(2), both of
those enactments provided a fair market value basis for purposes
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