WFC Holdings Corp. v. United States

WFC challenged the district court's holding that WFC was not entitled to a tax refund for a capital loss it claimed as a result of a complex transaction involving the transfer of leases and the sale of stock. WFC argued that the district court erred in finding that the lease restructuring transaction (LRT)/stock transfer constituted a sham transaction. The court concluded that the district court did not err in finding that the LRT/stock transaction lacked objective economic substance; in finding that WFC failed to meet its burden of proving by a preponderance of the evidence that avoiding the Office of the Comptroller of the Currency (OCC) regulations was its business purpose for the LRT/stock transfer; and in finding that WFC failed to prove by a preponderance of the evidence that the LRT/stock transfer was motivated by a purpose to strengthen its hand with good bank customers or to create management efficiencies. Accordingly, the court affirmed the judgment of the district court. View "WFC Holdings Corp. v. United States" on Justia Law