United States Third Circuit

The Tax Court's reversal of the IRS's determination that a state agency's limited liability company was simply a vehicle to impermissibly transfer federal historic rehabilitation tax credits (HRTCs) from the state agency to its company's wholly owned subsidiary and that all HRTCs taken by the subsidiary should be reallocated to the agency, is reversed, as the Tax Court erred in allowing the subsidiary, through its membership interest in the company, to receive HRTCs generated by the renovation of the historic building because the subsidiary should not be treated as a bona fide partner in the company as it did not have a meaningful stake in the success or failure of the partnership.

Appellate Information

• Decided 08/27/2012
• Published 08/27/2012

Judges

• Jordan

Court

• United States Third Circuit

Counsel