Brazil's Superior Court of Justice issued a judgment on 22 June 2020 concerning whether a company may be exempt from the limitation on the offset of accumulated losses in cases of a reorganization, such as a spin-off or merger, that results in the extinction of the company. Under Brazilian tax law, accumulated tax losses may generally be carried forward indefinitely, but can only offset up to 30% of a company's taxable income for a tax period. The case was the result of an appeal by the National Treasury of a decision by a Federal Regional Court, which held that a company should be allowed to offset the full amount of accumulated losses in the framework of a merger that resulted in the extinction of the company.

In its judgment, the Superior Court of Justice accepted the appeal and overturned the lower court decision. The Court held that because there is no specific law provision allowing for an exemption from the 30% limitation in cases of the extinction of a company due to merger or other reorganization, such a tax benefit cannot be granted. As such, the 30% limitation applies even in the fiscal year of extinction of a company.