Ezel / IRS Rulings / 1319018
Chief Counsel Advice 1319018 Released May 10, 2013 Advice

CCA 1319018: Unincluded liabilities do not increase amount realized on receivables

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This page covers one taxpayer's ruling from 2013, which can't be cited as precedent. Ask about your situation and see what the current Code and IRS guidance say, with citations.

Currency note: this determination was released in 2013
Statutory amendments, regulation changes, court decisions, or later IRS guidance may have changed the analysis since then. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, threshold, or position mentioned here.
Not precedent. Under 26 U.S.C. § 6110(k)(3), this written determination may not be used or cited as precedent. It resolved one taxpayer's situation on its specific facts, and identifying details were redacted by the IRS before release. The official IRS release (linked on this page as a PDF) is the authoritative source.
About this page: The plain-English summary and ruling snapshot below were written by Ezel based on the official IRS release. The full text is the IRS's own document.
View official IRS release (PDF)

Plain-English summary

Chief Counsel Advice addresses the amount realized when a taxpayer sells receivables. The advice states that the amount realized should not be increased by liabilities that the taxpayer did not include in establishing basis. It relies on Treas. Reg. § 1.1001-2(a)(3), which addresses liabilities incurred to acquire property and not taken into account in determining basis.

Ruling snapshot

  • Question: Does a liability omitted from basis increase the amount realized on a sale of receivables?
  • Outcome: Advice given.
  • Key authorities: IRC § 1001; Treas. Reg. § 1.1001-2(a)(3)

Full text (IRS public release)

ID: CCA_2013041815172654 Number: 201319018
Release Date: 5/10/2013
Office: -------------
UILC: 1001.00-00

From: -----------------
Sent: Thursday, April 18, 2013 3:17:30 PM
To: -----------------
Cc: ---------------------------------------------------------------------
Subject: Section 1001

---------to confirm our conversation earlier today, we are of the opinion that taxpayer’s amount realized on
the sale of its receivables should not be increased by the amount of D2 liabilities, which it did not include
in establishing basis. Section 1.1001-2(a)(3) of the regulations provides that if a liability is incurred by
reason of the acquisition of property, and that liability was not taken into account in determining the
taxpayer’s basis, then that liability is not taken into account for purposes of amount realized.

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