The FRG also argues that even if it assumed liability
for the West German bonds, the commercial activity exception would not apply to the (West German) bonds because Mortimer failed to satisfy settlement conditions by not complying with the validation procedures.
The lawmakers asked GAO to find out the federal government's risk if it allowed intermediate blends of ethanol, such as gasoline that contains 12 percent ethanol, and assumed liability
for damage done to vehicles and non-auto engines.
For contingent liabilities, P will generally include the assumed liability
in basis only as the liability is satisfied.
The Seventh Circuit Court of Appeals recently upheld a Tax Court ruling (see "Acquiring Contingent Liabilities," JofA, June04, page 73) that a corporation must capitalize its payment of an assumed liability
Additionally, when the partnership satisfies the obligation or when the obligation otherwise becomes fixed (when economic performance occurs), the deduction related to the assumed liability
is allocated to the contributing partner under Sec.
The assumed liability
would be a basis adjustment for her in year 5.
When an assumed liability
was incurred within the two-year period prior to the transfer and the taxpayer is taking the position that the liability was not incurred in anticipation of the transfer.
Several survey respondents said they recorded environmental liabilities as an assumed liability
in a purchase business combination.