Economic Substance in a Foreign Tax Credit Dispute

Brattle consulted for the US DOJ in Wells Fargo & Co. v. United States of America. The suit alleged that the taxpayer claimed $350 million in foreign tax credits in an abusive tax shelter that lacked economic substance. The taxpayer contended that the structured finance transaction was a legitimate source of low-cost financing. A Brattle team worked with counsel for several years on discovery requests, deposition preparation, and provided support for a multi-expert rebuttal strategy at trial. A Brattle Principal testified to the lack of profit potential and absence of a non-tax business purpose in the course of a multi-week jury trial, in which the US prevailed.