The Sale of Tax Credits Revisited: A CCA Consecrates (Most of) Tempel,


In a 2011 decision, Tempel v. Commissioner, the Tax Court had held, among other things, that gain on sales of state income tax credits was capital gain. In a new Chief Counsel Advice, the IRS has accepted the result, and most of the analysis, of Tempel, and it has also provided guidance about the tax consequences to a purchaser of credits. This article analyzes the CCA, discusses the remaining disagreements between t e Service and the Tempel court, stresses that the CCA's conclusions are explicitly limited to .nonrejimdable credits, cmd considers the results to a purchaser.


Taxation, Sales of State Income Tax Credits

Publication Date


Document Type


Place of Original Publication

Journal of Taxation of Investments

Publication Information

29 (3) Journal of Taxation of Investments 59 (2012)

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COinS Erik M. Jensen Faculty Bio