Gitlitz v. Commissioner, 531 U.S. 206 (2001), was a United States Supreme Court case decided in 2001.

In 1991, P. D. W. & A., Inc., an insolvent corporation taxed under Subchapter S, excluded its entire discharge of indebtedness amount from its gross income.

[1] David Gitlitz and other shareholders were assessed tax deficiencies because they used the untaxed discharge of indebtedness to increase their basis in S corporation stock and to deduct suspended losses.

He wrote that it "simply does not say that discharge of indebtedness ceases to be an item of income when the S corporation is insolvent.

He disagreed with the statutory interpretation of the decision, believing that examining the direct language of the provision would have led the Court to a contrary result.