BB&T's last stab at preserving $500 million in foreign tax credits has been denied by the U.S. Supreme Court.
The court declined to hear BB&T's bid to extend its fight with the Internal Revenue Service over the credits. Previous rulings in lower courts had upheld the IRS' rejection of the credits, and the bank in September had asked the Supreme Court to consider its appeal. The
BB&T declined to comment beyond a statement it shared with American Banker and other media.
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Wells Fargo lost its chance to appeal to the Supreme Court to approve its use of a complicated tax shelter. But clarity provided by that case and those being fought by BB&T and others is likely to provide the basis for future tax loopholes for banks.
June 16 -
BNY Mellon is facing a $900 million tax bill after a U.S. judge rejected its attempt to claim hundreds of millions of dollars in foreign tax credits.
February 12 -
BB&T announced Thursday that it earned $210 million in the first quarter, compared with $431 million a year earlier, as it took a $281 million charge related to a tax dispute with the Internal Revenue Service.
April 18
"We are disappointed at the Supreme Court's decision, but we do understand that only a fraction of the cases presented can be heard each year," said Brian Davis, a spokesman for the Winston-Salem, N.C., bank. "BB&T continues to firmly believe that this was a legitimate financing transaction and in compliance with the rules of the day."
The IRS had said BB&T and other banks were taking improper tax deductions through an investment vehicle known as STARS, or structured trust advantaged repackaged securities. The transactions allowed U.S. companies to do business with foreign banks — in this case, Barclays Bank in the U.K. — and realize savings provided by foreign tax laws.
BB&T was able to lower its tax bill before the IRS moved to bar the practice,
The Supreme Court previously