Five Words That Saved Billions
Do you know Section 382 of the US Tax Code? Me neither until today. Here is a quick refresher:
(a) General rule
The amount of the taxable income of any new loss corporation for
any post-change year which may be offset by pre-change losses shall
not exceed the section 382 limitation for such year.
Apparently is deals with how losses are calculated for businesses. Did you also know the US Treasury Department changed it a few weeks back? When Congress and the public was focused on the financial giveaway bailout, Secretary Paulson changed the rule:
The financial world was fixated on Capitol Hill as Congress battled over the Bush administration’s request for a $700 billion bailout of the banking industry. In the midst of this late-September drama, the Treasury Department issued a five-sentence notice that attracted almost no public attention.
It gets better. The second paragraph says:
Corporate tax lawyers quickly realized the enormous implications of the document: Administration officials had just given American banks a windfall of as much as $140 billion.
Yuppers! $140 Billion of your money. Nice, huh?









