Moneygram Debt Deductions Correctly Disallowed, Court Rules

The IRS correctly disallowed deductions that helped it to determine MoneyGram International Inc. owed $82.8 million because the company didn’t qualify for the break, the U.S. Tax Court ruled.

The case arose after the IRS determined that the money-transfer company and its subsidiaries weren’t permitted to deduct losses realized based on “wholly worthless asset-backed securities.”

The Tax Court’s Dec. 3 ruling that Moneygram didn’t meet the legal requirements to take the deduction is the second time the court reached this result. The court had to revisit the issue after the U.S. Court of Appeals for the Fifth Circuit tossed ...