Court denies Wells Fargo's $115M tax-deduction claim

Wells Fargo & Co. is not allowed to claim $115 million in tax refunds from 2002 related to a type of leasing transaction that the Internal Revenue Service considers an illegal tax shelter.

The U.S. Court of Federal Claims denied the deductions because the deals "lack economic substance and were intended only to reduce Wells Fargo's federal taxes," according to Judge Thomas Wheeler.

The deductions were based on "sale-in, lease-out," or SILO, deals that allow tax-exempt entities, such as public-transit agencies, to transfer tax benefits for a fee to a U.S. taxpayer. The benefits stem from depreciation on assets, such as rail cars, buses and telecom equipment, according to the ruling.

Wells Fargo said it was disappointed in the decision and is considering whether to appeal.

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Wells Fargo Refinance Mortgage Rates – Time to Refinance is 2010?

Wells Fargo refinance mortgage rates have been on quite the roller coaster ride over the last two months. With this being the case many people are wondering if the time to refinance is in 2010. Over the last two month we have seen the 30 year fixed mortgage rate go from 4.49% to over 5.25%. This drastic increase comes as the 10 year treasury rate yield has moved much higher.

Since the beginning of December we have seen the 10 year treasury rate yield move from 3.2% up to 3.85%. The strong move higher is one of the main reasons that we have seen mortgage rates move above 5%. If you are hoping to refinance your home loan under 5% in 2010 then you better get it done early. If you continue to wait you could be looking at 6% or 7% interest rates before you know it.

The Federal Reserve Bank plans to stop buying mortgage-backed securities at the end of March of 2010. Many analysts have predicted that an increase of one full percentage point is likely to happen after mortgage-backed securities are not being purchased by the Fed. This may come on the heels of an increase in mortgage rates due to ten-year yields moving higher as well.

Wells Fargo has positioned themselves very well for low interest rate environment but no one knows what will happen as mortgage interest rates increase. There is no doubt that many of the big banks have benefited from this low interest environment because they have gained customers and have been allowed to borrow money at extremely low rates.

Wells Fargo continues to advertise mortgage rates around 5% but this may change very quickly. If you’ve been thinking about refinancing or locking in at a low mortgage interest rate then it might be time to get your mortgage application submitted now. If you continue to wait you may lose the opportunity at these near all-time low mortgage interest rates.

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