CHICAGO, Ill. (KWQC) – U.S. Tax Court has ordered Exelon Generation to pay $1.45 billion dollars in back taxes and penalties.
The court ruled on September 19, 2016, that Exelon sold its power plants in 1999 for $4.813 billion. The company then had a taxable gain of $1.6 billion from the sale. According to Power Engineering, the IRS alleges Exelon tried to dodge paying the taxes owed on the sale by engaging in a sale-leaseback strategy with third parties that were tax exempt public utilities.
Exelon has the opportunity to appeal the ruling. According to Crain’s Chicago Business, Exelon has not decided whether to pay or appeal. A spokeswoman for Exelon told Power Engineering it would not seek to recover the penalty from consumers.