In March 2010, the Seventh Circuit awarded the Subchapter S bank community a monumental victory in the TEFRA disallowance appeal styled Vainisi v. Commissioner of Internal Revenue. In 2010 alone, shareholders of Sub S banks realized an estimated $21 million in savings from this decision.
The Subchapter S Bank Association is proud to have organized and funded this critical appeal, which ultimately led to IRS’s withdrawal of the proposed rule. The victory represents a perfect example of the great things that can be accomplished when Sub S bankers from across the country unite to fight for a common cause.
The presence of a unified voice to speak out for the Sub S bank community is as important as ever. When the U.S. Treasury Department failed to create a plan under the TARP Capital Purchase Program for Sub S banks, the Subchapter S Bank Association stepped in and led the way. Again, when Treasury neglected to create a Small Business Lending Fund program for Sub S banks, the Subchapter S Bank Association was there.
For more information about these and other developing issues affecting the S corporation taxation of financial institutions, please feel free to contact Bruce Toppin at 210-228-4414.