Tax Blog

Earlier this year, my former colleague Jonathan Prokup and I published an article in the Journal of Taxation and Regulation of Financial Institutions.  In the article, we considered the federal tax consequences of Treasury's capital purchase program – the centerpiece of TARP.  Under the program, Treasury invested several hundred billion dollars into hundreds of our country's banks to alleviate their perceived liquidity problems, which many believed to be the cause of the unfolding financial crisis.

Our article concluded that, even though most TARP instruments were nominally ...