While Congress has recognized that the loss of revenue is an acceptable side effect of special tax provisions designed to encourage taxpayers to make certain types of "tax shelter
" investments that yield tax benefits, losses from tax shelters
oftentimes produce little or no benefit to society, or the tax benefits are exaggerated beyond those intended.
Therefore, although the transactions at issue were tax shelters
under the Seventh Circuit's definition in Valero, if the Seventh Circuit had issued the decision in Countryside, it may well have decided that Egan was not promoting the shelters and that Countryside was not subject to the exception for this reason.
have become so widespread and abusive that Congress has taken action.
Because these actions have substantially curbed tax shelter
activities, no further action is warranted.
Schallheim and Wells (2006) measure nondebt tax shields based on the difference between taxes paid and financial statement tax expense in an attempt to capture the effect of "off financial statement" deductions such as accelerated depreciation, stock option deductions, tax shelters
, and the like.
A November 2003 report from the Senate Permanent Subcommittee on Investigations concluded that "dubious tax shelters
are no longer the province of shady, fly-by-night companies, .
The Treasury Department and the Internal Revenue Service (IRS) believe that the most effective way to curb inappropriate tax shelter
behavior is to shine an early spotlight on potentially abusive transactions by requiring detailed tax return disclosures.
The number of tax shelters
has declined significantly over the past fifteen years with the gradual introduction by the federal government of more and more tax rules to combat what it sees as abuses of the tax system by tax shelters
According to the United States Department of Treasury, the proliferation of illicit corporate tax shelters
may be the most serious compliance issue threatening the U.
The courts threw out their tax shelters
as "sham" transactions, entered into for no purpose other than to escape taxes.
Money magazine found that Elizabeth Dole's two biggest tax shelters
saved her and her husband, Bob Dole, more than $298,000 in taxes between 1983 and 1994.
If his analysis proves anything, however, it's mostly that tax shelters
and loopholes are as culpable as high tax rates.
The IRS has been challenging tax shelters
for more than 35 years.
As TEI put in its letter about Announcement 2005-80, "This is not about tax shelters
, but about the fundamental nature of [taxpayer rights].