Ford Motor Co. v. United States, No. 17-2360 (Fed. Cir. 2018)Annotate this Case
Ford sued to recover interest payments that it alleges the government owes on Ford’s past tax overpayments. Ford can only recover this interest if it and its Foreign Sales Corporation subsidiary were the “same taxpayer” under 26 U.S.C. 6621(d) when Ford made its overpayment and the subsidiary made equal tax underpayments. The Claims Court granted the government summary judgment for the government after concluding that Ford and its subsidiary were not the same taxpayer. The Federal Circuit affirmed, explaining the interplay between the “interest netting” provision of 26 U.S.C. 6621(d) and the Foreign Sales Corporation (FSC) statute that incentivized U.S. company exports in 1984-2000. Treating FSCs and their parents as different taxpayers under section 6621(d) does not create any tension between section 6621(d) and the FSC statute. The FSC statute encouraged corporations to export through FSCs, even if section 6621(d) did not provide an additional interest netting benefit for that arrangement.