Post Content

Division of Local Services attorney James Crowley has written a very clear and compelling story on a complicated tax case for the latest edition of City and Town , the free DLS publication emailed biweekly to thousands of local officials across the Commonwealth.

Aptly titled "That's Nobody's Business: Sham Corporation Denied Personal Property Tax Exemption," Crowley surgically dissects an Appeals Court decision issued last year that upheld an Appellate Tax Board denial of a property tax exemption to a leasing corporation.

The court ruled that the leasing corporation, MASSPCSO, formed by the wireless telecommunications company Sprint Spectrum, L.P., was a sham because it did not engage in business and was created solely for the purpose of avoiding taxes.

Sprint formed the sham leasing company as a way to transfer taxable equipment to a subsidiary (MASSPCSO) and then lease back the equipment for use in Massachusetts as a way of avoiding local personal property taxes. The local assessors didn't buy the scheme, and neither did the courts.

As Crowley noted, "the Appeals Court observed that MASSPCSO had no employees; failed to keep separate bank accounts; did not independently make investments; did no business with other parties except where it was incidental to leasing equipment to the parent; did not lease property to third parties; could not act independently; did not purchase equipment or be responsible for debt incurred in conjunction with said purchases."

In other words, a classic sham transaction.

Written By:

Recent Posts

MA Filing Extension to April 18th Announced posted on Apr 15

The Department of Revenue’s WebFile tool, which allows individuals to electronically file state personal income tax returns, has experienced delays due to heavy volume over the past few days. DOR is actively working to resolve this issue, and has extended the deadline for taxpayers to   …Continue Reading MA Filing Extension to April 18th Announced

WARNING: Tax Lien Notices NOT issued by DOR Making the Rounds posted on Mar 13

Here’s another unfortunate addition to the list of financial things to protect yourself from.  DOR has learned that letters of questionable origin are being sent to taxpayers with outstanding tax liens. Although these notices show amounts from actual tax liens, they are not from the Massachusetts   …Continue Reading WARNING: Tax Lien Notices NOT issued by DOR Making the Rounds

Don’t Let a Hacker Steal YOUR Refund posted on Mar 11

There are some rabbit holes you definitely don’t want to fall down during tax season. One such hole, and an increasingly-common nightmarish scenario, is finding out your tax refund has been stolen. In a recent article, Allison Martin of Money Talk News was the bearer   …Continue Reading Don’t Let a Hacker Steal YOUR Refund