Wednesday, June 4, 2008

Court decision favoring tax shelter is an aberration, IRS official says

A recent court decision rejected an argument by the Internal Revenue Service that the defendant had invested in an improper tax shelter, but as a Wall Street Journal columnist says, "Don't rush into that tax shelter just yet."

The Journal's Tax Report surmises that:

Many investors battling the Internal Revenue Service in high-stakes tax-shelter cases may take some hope from the government's defeat . . . . But IRS lawyers view the decision as merely a temporary setback on the road to annihilating the badly battered shelter business. Indeed, the government has won most recent cases involving shelters.
One lawyer predicted the court decision in the tax shelter case would be reversed on appeal.