Transcription of Insolvency Procedures under Section 108
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INSIGHTS SPRING 2012 63 Insolvency Procedures under Section 108 Irina Borushko and Urmi SampatIncome Tax Insolvency InsightsIn the current prolonged recession, many industrial and commercial entities have had to restructure their outstanding debt. Many debtor entities have had to restructure their public bonds as well as their private mortgages and notes. In particular, many real estate-intensive debtor entities have had to restructure their commercial real estate mortgages. When any amount of debt repayment is forgiven in such a debt restructuring, that event causes the debtor entity to recognize cancellation of debt (COD) income for federal income tax purposes.
www.willamette.com INSIGHTS • SPRING 2012 63 Insolvency Procedures under Section 108. Irina Borushko and Urmi Sampat. Income Tax Insolvency Insights
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