Solyndra Backer Sought Tax breaks Months before Bankruptcy

by San Antonio Attorney

According to court papers filed, a backer of Solyndra who was politically connected tried to hold onto the tax breaks months before the company filed for bankruptcy to protect its interest in case the business fails.

The information was unveiled by the Internal Revenue Service, which filed an objection to the reorganization plan of Solyndra on Wednesday.

Solyndra received a $535 million guaranteed loan from the government. President Barack Obama even made the company as an example to show the government’s support for sustainable energy jobs. But when Solyndra filed for bankruptcy, it has been used by Republicans as political weapon for the November elections while they emphasize that energy policy for fossil fuels is better.

Solyndra filed for Chapter 11 bankruptcy in Sept. 2011, blaming a glut of cheap imported solar panels from China that caused the prices to plunge.

If creditors approve, a holding company would be created in bankruptcy without business operations or employees, but tax breaks of around $350 million that investors of Solyndra could reap.

The two biggest investors of Solyndra are GKFF Investment Company, LLC and Argonaut Ventures I, L.L.C. Both are owned by George Kaiser Family Foundation of Tulsa, Oklahoma.

According to the IRS, the creditors of Solyndra would receive cents on the dollar under the plan, and that the main intent behind it is to avoid tax.

Solyndra’s spokeswoman said the company would answer the IRS in papers but declined to give a comment on the issue.

Around December 2010, investors already feared a possible liquidation of the company if the Department of Energy would not provide additional loans for Solyndra, the IRS said in its filing.

Emails from Kaiser to one of the managing directors of the firm were cited by the IRS. In one of them, Kaiser wrote that he would do whatever he can to preserve the Net Operating Losses.

In Solyndra’s court filings recently, it said it may not be able to pay back any of the government backed loans it obtained in 2009.

 

-   Liens, including tax liens, are not discharged by bankruptcy. To find out what types of taxes can be discharged and cleared by bankruptcy, discuss your situation with a San Antonio Chapter 13 Attorney.

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