Tuesday, November 6, 2012
Following up on my previous posts (links below): Bloomberg, IRS Loses Appeal to Stop Solyndra From Carrying Out Plan:
The IRS lost its request to delay Solyndra from carrying out its restructuring plan while the agency appeals a bankruptcy judge’s approval of the failed solar-panel maker’s plan to exit court protection.
The IRS was denied its bid for a so-called “stay” to keep Solyndra, which received a $535 million U.S. Energy Department loan guarantee before going bankrupt, from implementing its plan which the government claims will make its appeal moot because it would be too difficult to undo afterward. ...
[Judge] Walrath approved the plan last month over the government’s objection that it couldn’t be approved because the principal purpose of the plan was to allow Argonaut Ventures I and Madrone Partners, Solyndra’s plan sponsors and indirect owners, to avoid taxes.
Under the plan, Solyndra will be liquidated while its parent, 360 Degree Solar Holdings, will exit court protection with so-called net operating loss carryforwards of as much as $975 million, which it may use against future income, according to court papers. The potential tax breaks may be as much as $341 million for 360 Degree investors Argonaut and Madrone.
Prior TaxProf Blog coverage:
- IRS Objects to Solyndra's Bankruptcy Plan, Says Owners Manipulated Rules to Preserve $975m of NOLs (Oct. 12, 2012)
- WSJ: Taxpayers Will Lose Twice if Bankruptcy Court Allows Solyndra Insiders to Harvest $975m of NOLs (Oct. 16, 2012)