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P seeks to apply NOLs to his 1995, 1996, and 1997
income which was not includable in the bankruptcy
estate. R contends that P may not carry NOLs to any
years prior to the termination of P’s bankruptcy
estate; i.e., 1996 or 1995.
1. Held: The “termination” of P’s ch. 11
bankruptcy, for purposes of sec. 1398, I.R.C., occurred
upon the confirmation of the plan and discharge of the
debtor.
2. Held, further, P may use NOLs with respect to
his separate tax reporting in the year of the
commencement of his bankruptcy and later years, to the
extent allowed under sec. 172, I.R.C., and the
regulations thereunder.
Oren L. Benton, pro se.
Frederick J. Lockhart, Jr., and John A. Weeda, for
respondent.
OPINION
GERBER, Judge: Respondent determined deficiencies in
petitioner’s Federal income taxes, an addition to tax, and
penalties for the short taxable year of February 23 through
December 31, 1995, and the taxable years 1996 and 1997, as
follows:
Accuracy-
Addition to Tax Related Penalty
Year Deficiency Sec. 6651(a)(1) Sec. 6662
19951 $75,771 -- $15,154
1996 240,565 -- 48,113
1997 249,337 $57,967 46,374
1 Pursuant to sec. 1398(d)(2)(D), petitioner elected to
terminate his taxable year as of the bankruptcy commencement
date, Feb. 23, 1995. The deficiency is with respect to the short
tax year of Feb. 23 through Dec. 31, 1995.
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