CHAPTER TWO
Discharge of Indebtedness
§ 2.1 Introduction
§ 2.2 Discharge of Indebtedness Income
§ 2.3 Determination of Discharge of Indebtedness Income
(a) What Is Discharge of Indebtedness Income?
(i) In General
(ii) Discharge of Recourse and Nonrecourse Debt
(iii) Transfer or Repurchase of Debt
(iv) Income Other than Discharge of Indebtedness
(v) No Income
(vi) Contested Liability Doctrine and Unenforceable Debt
(b) Is the Obligation Indebtedness?
(c) Who Is the Debtor?
(d) When Does Discharge of Indebtedness Income Occur?
§ 2.4 Section 108(e) Additions to Discharge of Indebtedness Income
(a) Debt Acquired by Related Party: Section 108(e)(4)
(i) Related Party
(ii) Acquisition by a Related Party
(A) Direct Acquisition
(B) Indirect Acquisition
(iii) DOI Income for a Related Party Acquisition
(b) Indebtedness Contributed to Capital: Section 108(e)(6)
(i) Allocation between Principal and Interest
(ii) Withholding Requirement
(iii) Accounting Method Differences
(c) Stock for Debt: Section 108(e)(8)
(i) Background
(ii) Overlap with Capital-Contribution Rule
(A) Meaningless Gesture Doctrine
(B) Bifurcation
(C) Advantages and Disadvantages
(d) Debt for Debt: Section 108(e)(10)
(i) Background
(ii) Publicly Traded Debt versus Non–Publicly Traded Debt
(iii) Significant Modification of a Debt Instrument
(A) Modification
(B) Significant Modification
(C) Multiple Modifications
(D) Disregarded Entities
§ 2.5 Section 108(e) Subtractions from Discharge of Indebtedness Income
(a) Otherwise Deductible ...
