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in more than one place in the same statutory section, the term or
phrase should have the same meaning. See Venture Funding v.
Commissioner, 110 T.C. 236, 250 (1998).
The phrase “termination of the estate” in section 1398(f)(2)
has been considered in the context of a chapter 7 liquidating
bankruptcy. Section 1398(f)(2) provides:
In the case of a termination of the estate, a transfer
(other than by sale or exchange) of an asset from the
estate to the debtor shall not be treated as a
disposition for purposes of any provision of this title
assigning tax consequences to a disposition, and the
debtor shall be treated as the estate would be treated
with respect to such asset.
The bankruptcy court analyzed whether abandonment of assets
of a bankruptcy estate by the trustee triggers tax consequences
to the estate in In re McGowan, 95 Bankr. 104 (Bankr. N.D. Iowa
1988). The bankruptcy trustee and the debtor argued that the
trustee’s abandonment of the property was a disposition for tax
purposes and that the tax liability arising from the disposition
was the obligation of the estate or the trustee. The trustee and
the debtor stood to gain by their argument because there were no
assets in the estate and the parties agreed that the trustee
would not be personally liable for the taxes of the estate. The
Internal Revenue Service and the State of Iowa argued that the
abandonment of the assets was a “transfer” of assets from the
bankruptcy estate to the debtor pursuant to section 1398(f)(2),
and therefore the estate would not have any tax consequences
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