Statement of Eileen J. O'Connor Assistant Attorney General for the Justice Department's Tax Division on the Decision in BB&T v. United States of America

The following press release was published by the US Department of Justice on Jan. 4, 2007. It is reproduced in full below.

FOR IMMEDIATE RELEASE THURSDAY, JANUARY 4, 2007 WWW.USDOJ.GOV TAX (202) 514-2007 TDD (202) 514-1888 WASHINGTON - “Today’s decision by the United States District Court for the Middle District of North Carolina affirms that, notwithstanding vigorous and complicated paper shuffling, to have a tax deduction for lease or interest expense, you must actually incur them. And to incur them, you must have a genuine lease and genuine indebtedness, respectively. In BB&T vs. United States of America, the District Court found that the Lease-In, Lease-Out tax shelter involved neither, and therefore does not result in the tax deductions claimed by those who participate in it.” 07-002

Source: US Department of Justice