Second Circuit Denies Altria’s SILO/LILO Refund Claim

The Second Circuit Court of Appeals affirmed the trial jury’s decision denying Altria Group’s claim for a tax refund based on four sale in, lease out (SILO) and lease in, lease out (LILO) transactions in 1996 and 1997.

The jury denied the tax refunds based on the judicial theory of substance over form. The district court denied Altria’s post trial motions to overturn the verdict as a matter of law and for a new trial. What is notable about this case is not only that the Second Circuit affirmed the jury decision but affirmed the application of the substance over form doctrine as the rationale for the decision. Prior to this decision, these transactions and other similar transactions have largely been decided under the economic substance doctrine.

Read the opinion here:
Altria Group, Inc. v. United States

10th Circuit: Son of Boss Transaction Lacks Economic Substance

The 10th Circuit Court of Appeals rejects the District Court’s findings in support of a taxpayer who entered into a Son of BOSS transaction and holds that the transaction lacked economic substance.

Sala v. U.S. Docket No. 08-1333 (10th Cir. July 23, 2010)

For informed commentary on Sala link HERE and HERE.