Sunday, August 29, 2004

On Friday, the U.S. District Court for the Distirct of Connecticut issed a 198-page opinion in favor of the IRS in the infamous Long-Term Capital Management case. The court found that LTCM improperly took $106 million in tax deductions, resulting in perhaps the IRS’s largest civil tax victory ($56 million in taxes and penalties). The court held that the nine cross-border lease-stripping transactions lacked economic substance and was sharply critical of LTCM’s tax lawyers (William McKee and Mark Kuller, formerly of King & Spalding (Atlanta) and later founders of the McKee Kuller law firm). For the New York Times coverage, see here.