Sunday, March 28, 2010
The tax news has been all good lately for some of the nation’s leading banks. First, JPMorgan Chase found out it will receive a fat refund from the federal government, and now Bank of America and Wells Fargo won’t have to pay federal income taxes for 2009.
BofA is off the hook because it reportedly lost money last year. As for Wells Fargo, the country’s fourth largest bank won’t have to pay income taxes because of losses it sustained from rescuing Wachovia.
JPMorgan Chase is expecting a tax refund of possibly as much as $4 billion as a result of the stimulus plan and its takeover of Washington Mutual.
Prior to the stimulus, companies could only “carry-back” their losses for two years, but the stimulus plan extended that period to five years. This allowed the big banks and others to average out their tax payments over a longer period that included the loss years of 2008 and 2009.
-Noel Brinkerhoff
Bank of America, Wells Fargo Probably Won't Pay Income Tax for 2009 (Christina Rexrode, Charlotte Observer)
JPMorgan Chase May Get Billion-Dollar Tax Refund to Offset Recession Losses (by Noel Brinkerhoff, AllGov)
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