In the case of Motorlease Corp. v. United States in 1965, the Supreme Court ruled on a dispute regarding tax deductions for car leasing companies. The issue at hand was whether or not these companies could claim depreciation and investment credit on cars leased to customers who had an option to purchase them at a later date. The court held that such options did not disqualify lessees from claiming these benefits because they were still considered as owners of the vehicles under Section 38 property rules, which define ownership based on risks and rewards rather than legal title alone. Therefore, even though customers might eventually buy the cars, during lease periods it is lessors who bear all financial risks associated with vehicle ownership including maintenance costs and market value fluctuations; hence their eligibility for related tax advantages.

In the dissenting opinion for Motorlease Corp. v. United States, it was argued that the majority's interpretation of Section 1231(b)(2) of the Internal Revenue Code was incorrect and overly broad. The dissenting justices believed that this section should not apply to property used in a trade or business if such property is held primarily for sale to customers in ordinary course of business, as they felt this would lead to an unfair tax advantage for businesses who lease their assets rather than sell them outright. They also disagreed with the majority's view that leased vehicles were depreciable assets under Section 167(a), arguing instead that these vehicles are more akin to inventory held by a dealer for resale purposes and thus should be excluded from depreciation deductions altogether.