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Second Circuit; Fifth Circuit; Eighth Circuit; Bright Line Rule; I.R.C. §§ 901-909; Sham Transactions; Subjective Non-Tax Business Purpose; Bank of New York (BNY); Structured Trust Advantaged Repackaged Securities (STARS); Internal Revenue Service (IRS); Barclays Bank PLC; Tax Court; Common Law Doctrine; Gregory v. Helvering; Gilbert v. Commissioner; Frank Lyon Co. v. United States; Health Care and Education Reconciliation Act; Fail Presumption; Bifurcation; Tax Benefits as Profit; Compaq Comput. Corp. & Subsidiaries v. Commissioner; IES Industries v. United States; Congressional Intent;
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Full-Text Articles in Law
Putting The Substance Back Into The Economic Substance Doctrine, Nicholas Giordano
Putting The Substance Back Into The Economic Substance Doctrine, Nicholas Giordano
Brooklyn Journal of Corporate, Financial & Commercial Law
The foreign tax credit, which saves U.S. taxpayers from paying both foreign and domestic income taxes on the same income, is critical to facilitating global commerce. However, as savvy taxpayers discover increasingly complicated ways to abuse the foreign tax credit regime through the structuring of business transactions, courts have become increasingly skeptical of the validity of those transactions. Using the economic substance doctrine, a common law doctrine codified in 2010 at I.R.C. § 7701(o), courts will disallow tax benefits stemming from a transaction that is not profitable absent its tax benefits, and which the taxpayer had no incentive to undertake …