United States v. Foster Lumber Co.

Mr. Justice Blackmun, with whom The Chief Justice, Mr. Justice Brennan, and Mr. Justice Powell join,

dissenting.

What is at issue here is whether a corporate taxpayer’s fiscal 1966 net operating loss deduction, carried back from 1968, as provided for by § 172 (a) of the Internal Revenue Code of 1954, 26 U. S. C. § 172 (a), was, to use the Government’s and the Court’s term, “absorbed” by the taxpayer’s capital gain1 for 1966, despite the taxpayer’s inability to offset the deduction against capital gain.2

The Government’s position is that the 1968 loss was “com*50pletely absorbed” 3 in 1966 and is…