Tax

Immediate Reaction to 2008-83 Public and Grassley The reaction to the Notice was widespread. There were companies, which immediately took advantage of the benefit, such as Wells Fargo. Other companies were less enthusiastic about the consequences.

IRS Notices – Purpose and Authority While Congress authors the Internal Revenue Code and associated Regulations, the responsibility of enforcement is given to the Treasury. The Treasury has the power to author Regulations, but delegates its responsibility of enforcement and collection to the Internal Revenue Service, an agency within the Treasury.

Introduction to the Notice The “Infamous IRS Notice”, or Notice 2008-83[i], was issued on 10/01/2008, days after failure of several banks. In less than a page, the Internal Revenue Service (IRS) effectively rewrote §382, and allowed banks to ‘buy’ net operating losses (NOLs) through mergers and acquisitions.

The next few posts will be from an paper I wrote a few years ago concerning the banking crisis and the IRS Notice 2008-83. While I had not thought of this topic in quite a while, the current conversations around Bank of America’s purchase of Countrywide and the latest settlement makes this a touch more relevant at the moment.