Lease Syndication Transactions: How Do You Do It?

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Do you or your clients buy blocks of leases that were originated by brokers or other equipment lessors?

In many cases, parties in these transactions wish to retain servicing of the sold leases, and maintain what is known in the industry as "blind" status with their customers/lessees (i.e....the lessees don't know that their lease has been sold or assigned).

At the same time, state and local departments of revenue and their in-house and out-sourced auditors, are being very aggressive in regards to sales and use tax and personal property tax assessments.


In the interest of gathering best practices for managing SALT-related risk in this area, otherwise known as "lease syndication" transactions, I would like to gather input from others to determine if there is a generally accepted way of transferring sales and use tax and/or personal property tax filing obligations from a seller to a buyer in a lease syndication transaction.

By "generally accepted" I mean a method that is: 1) commonly used within the industry, and 2) consistently accepted by state and local taxing jurisdictions.

In the absence of such a generally accepted method, how do equipment leasing companies quantify and manage the tax risk they assume by either taking on or assigning away filing responsibilities?

Please respond to this post by either sending me an e-mail at [email protected] or by posting a comment to this blog post.

Thank you.


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