Beard Becomes First Intermountain Case to Reach the Supreme Court

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June 30, 2011

We have been noting for the past few months that the Intermountain issue would be heading to the Supreme Court soon, with the government’s petition in the Home Concrete case due on July 5.  The taxpayers in Beard have jumped the line, however, by seeking certiorari ahead of the deadline, and that case is now docketed in the Supreme Court as No. 10-1553.  Meanwhile, the government has obtained a 30-day extension until August 3 to file its certiorari petition in Home Concrete.  Thus, unless the taxpayer in either Salman Ranch, Grapevine, or one of the D.C. Circuit … Read More

Government Files Response in Anschutz

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June 29, 2011

The government filed its response brief in Anschutz Co., et al. v. Commissioner, Nos. 11-9001 & 11-9002 (10th Cir.), on June 22, 2011 (linked below).  See our prior coverage here.  Not surprisingly, the government argues that the Tax Court got it right in viewing the putatively separate variable prepaid forward contracts and stock loans as two parts of one overall arrangement, designed to monetize the value of the taxpayer’s low-basis stock at the outset of the deal.  The Tax Court held that, in substance, the overall arrangement was a sale for tax purposes because the benefits and … Read More

D.C. Circuit Gives the Government Another Victory in Intermountain

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June 22, 2011

The D.C. Circuit yesterday reversed the Tax Court in Intermountain, handing the government more ammunition to use if, as appears increasingly likely, the Supreme Court considers the question of the applicability to overstatements of basis of the six-year statute of limitations found in Code sections 6229(c)(2) and 6501(e)(1)(A).  This now makes the score 4-2 for the government and represents the third straight court of appeals to adopt the government’s primary argument that courts owe Chevron deference to the relatively recent Treasury regulations interpreting the six-year statutes to apply to overstatements of basis.

The D.C. Circuit’s opinion is comprehensive, tracing … Read More

Briefing Completed in Entergy

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June 14, 2011

The government has filed its reply brief in the Fifth Circuit in Entergy.  (See our initial report on the case here.)  The reply brief puts forth a somewhat less disapproving attitude towards the examination of extrinsic evidence in foreign tax credit cases than previously advanced, stating as follows:  “The Commissioner does not contend (as he did below) that extrinsic evidence has no relevance in determining creditability under Treas. Reg. § 1.901-2(b).  Rather, our argument is that it was improper for the Tax Court to supplant an analysis of the windfall-tax statute with an analysis of extrinsic evidence.”

The … Read More

Government Decides Against Further Review in Washington Mutual

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June 2, 2011

As we previously reported, the Ninth Circuit in Washington Mutual reversed the district court and ruled that the taxpayer did have basis in regulatory rights that it received in connection with a transaction in which it took over failed thrifts during the savings-and-loan crisis of the 1980s.  The government has now allowed the periods for seeking rehearing and certiorari to expire without taking action.  The Ninth Circuit’s decision is therefore final, and the case will move on to further proceedings on remand in the district court to determine the amount of basis.… Read More