STATEMENT OF EILEEN J. O’CONNOR ASSISTANT ATTORNEY GENERAL FOR THE JUSTICE DEPARTMENT'S TAX DIVISION
ON THE FEDERAL CIRCUIT COURT OF APPEALS DECISION IN COLTEC INDUSTRIES, INC. V. UNITED STATES:

WASHINGTON, D.C. - “Today’s decision by the United States Court of Appeals for the Federal Circuit confirms that illusionary losses purportedly created by the so-called ‘contingent liability’ tax shelter are not deductible against actual taxable income. The Court’s decision is the second from a United States Court of Appeals to address this tax shelter scheme, and represents a significant advance in the Justice Department’s ongoing effort to combat abusive tax shelters and restore integrity to the tax laws.”

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06-426