Argument of Justice Marshall
Mr. Marshall: The third case, Cottage Savings Association versus the Commissioner, No. 89-1965, is here on certiorari to the Court of Appeals for the Sixth Circuit.
The question in this case is whether a lending institution may realize tax deductible losses by exchanging its mortgage loans for mortgage loans held by other financial institutions.
In an opinion filed with the clerk today, we hold that such transaction does give rise to realized losses.
Accordingly, we reverse the judgment of the Fifth Circuit.
Justice Blackmun has filed a dissenting opinion in which Justice White joins.
