Section 16.26 Cases Holding That Abandonments Are Not Taxable Transfers

• Library: Bankruptcy Practice (2007 Ed. + 2015 Cum Supp)

B. (§16.26) Cases Holding That Abandonments Are Not Taxable Transfers

The vast majority of courts addressing the issue of whether a trustee’s abandonment of property during the pendency of a bankruptcy proceeding is a taxable transfer have held such a transfer to be a nontaxable event. The leading case espousing this view is the Eighth Circuit’s decision in In re Olson, 930 F.2d 6 (8^th Cir. 1991) (per curiam). The debtors in Olson were a husband and wife who owned two parcels of land subject to one mortgage. Because they were...