Abstract
In Tempel v. Commissioner, decided in April 211, the Tax Court came to a number of important conclusions about sales of state income tax credits that occurred shortly after the credits had been received. The gain was held to be capital gain (with the court implicitly concluding that the credits were property), but the holding period for the credits began at receipt and the taxpayers had no basis in the credits. The bottom line was that the gain was short-term capital gain, with no basis offset, a negative result for these taxpayers. But the Tax Court’s conclusion that the credits were capital assets creates planning opportunities for others.
Keywords
Tempel v. Commissioner, Tax Court decision, state income tax credits, capital gains
Publication Date
2011
Document Type
Article
Publication Information
Journal of Taxation of Investments, Summer 2011, at 91
Repository Citation
Jensen, Erik M., "The Sale of State Tax Credits: A Tax Court Decision Isn’t a Temple of Doom" (2011). Faculty Publications. 482.
https://scholarlycommons.law.case.edu/faculty_publications/482
