Dave, thanks for a prompt response. I've checked your previous posts. However, as @MS456 has explained at great length above, the description regarding the Time Deposit explained at a great length on Cornell website as well as Ruchelaw seems to be clarifying that "unrealized" conversion from one CD to another does not result in an event to recognize gain/loss. Please see this verbatim from the Ruchelaw post, referenced by MS456 before.
Also, were you able to take a look at what @Mike9241 had recommended regarding USD/Lira conversion in the past. Can you please review this one time and opine? Appreciate your patience and support!
"Special Rules Relating to Certificates of Deposit
As noted above, certificates of deposit can be Section 988 transactions if
denominated in a foreign currency or if value is determined by reference to that
foreign currency. However, there are special rules with respect to certificates of
deposit. In particular, no exchange gain or loss is recognized with respect to the
following transactions:
• The deposit of nonfunctional currency in a demand or time deposit or
similar instrument (including a certificate of deposit) issued by a bank or
other financial institution if such instrument is denominated in such
currency;
• Withdrawal of nonfunctional currency from a demand or time deposit or
similar instrument issued by a bank or other financial institution if such
instrument is denominated in such currency;
• Receipt of nonfunctional currency from a bank or other financial institution
from which the taxpayer purchased a certificate of deposit or similar
instrument denominated in such currency by reason of the maturing or
other termination of such instrument; and
• The transfer of nonfunctional currency from a demand or time deposit or
similar instrument issued by a bank or other financial institution to another
demand or time deposit or similar instrument denominated in the same
nonfunctional currency issued by a bank or other financial institution.
For these purposes, the taxpayer's basis in the units of nonfunctional currency or
other property received in the transaction is the adjusted basis of the units of
nonfunctional currency or other property transferred.11"
@DaveF1006 , @MS456 , @Mike9241
