The Court of Federal Claims has rejected Wells Fargo & Co.’s attempt to claim a $115 million tax deduction stemming from 26 sale-in, lease-out transactions, 17 of which involved public transit agencies, saying that the deals lacked economic substance.

In a decision filed Jan. 8, Judge Thomas C. Wheeler ruled that Wells Fargo is not entitled to depreciation, interest and transaction cost deductions for the 2002 tax year, concluding that the so-called SILO deals did not substantively change anything for either the bank or the tax-exempt entities engaging in the transactions and were done simply to transfer the tax benefits from the tax-exempt entities to the bank.

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