The Tax Court disallows losses generated by a CARDS tax shelter (Custom Adjustable Rate Debt Structure) and affirms imposition of a 40% penalty.
Read the opinion here:
Kerman v. Commissioner, TC Memo. 2011-54
Tag Archives: Tax Shelter
Fifth Circuit: Overstated Basis is Not Omitted Income for the 6-Year Statute of Limitations
The hits keep on coming. The Fifth Circuit joins the growing chorus from the Courts of Appeals holding that an overstatement of basis does not equal an omission of income and the 6 year statute of limitations does not apply.
Read the opinion here:
Burks v. United States, No. 09-11061 (5th Cir. Feb. 9, 2011)
4th Circuit: 6 Year Statute of Limitation Does Not Apply to Overstatement of Basis
The Fourth Circuit Court of Appeals joins two other circuits holding that the 6 year statute of limitations does not apply to an overstatement of basis.
Read the opinion here:
Home Concrete & Supply v. United States, No. 09-2353 (4th Cir. February 7, 2011)
7th Circuit: Overstatement of Basis triggers 6 Year Statute of Limitations
The Seventh Circuit Court of Appeals overturns the Tax Court holding that a taxpayer’s overstatement of basis in a Son of Boss tax shelter is an omission of income under ยง 6501(e) triggering the six year statute of limitations.
For commentary on the implications of this opinion visit Tax Appellate Blog.
Read the Opinion:
Beard v. Commissioner, No. 09-3741 (7th Cir. Jan. 26 2011)
Palmlund v. Commissioner
The Tax Court holds that a partnership can assert a reasonable cause defense to section 6662 penalties. However, reliance on a promoter, defined as an “advisor who participates in structuring the transaction”, is not reasonable cause for purposes of avoiding the penalty.
Ninth Circuit: No Jurisdiction over Bifurcated TEFRA Partnership Interests
The Ninth Circuit Court of Appeals rules that it does not have jurisdiction over partner’s bifurcated interests (direct and indirect) in a TEFRA partnership.
Second Circuit Upholds Tax Shelter Convictions
The Second Circuit Court of Appeals upholds the tax shelter related convictions of a KPMG parter & manager and the conviction of Sidley Austin partner R.J. Ruble.
Read the opinion here:
U.S. v Pfaff, No. 09-1702 (August 27, 2010)
Federal Claims: Accuracy Penalties Apply to Son of Boss Participants
The Court of Federal Claims uphold accuracy related penalties against several Son of Boss tax shelter partnerships.
Belmont Investors, LLC v. United States
Belmont Investments LLC v. United States, Case No. 4:07cv9 (E.D. Tex August 2, 2010)
For more on Belmont and Andrew Beal click here.
10th Circuit: Son of Boss Transaction Lacks Economic Substance
The 10th Circuit Court of Appeals rejects the District Court’s findings in support of a taxpayer who entered into a Son of BOSS transaction and holds that the transaction lacked economic substance.