Corporate tax planning in the 1990s became a high stakes game where more and more consultants were selling “packages” to large companies that often used multiple sections of the Internal Revenue Code and complex transactions to achieve massive tax savings. IRS strategies to deal with these transactions, which were growing more and more complicated, soon begin to fall behind. Litigation, legislation and regulations were just not enough. Now the IRS is focusing on disclosure and transparency to lead the way in finding what it has determined to be “abusive transactions.” More and more companies are being caught in the IRS net and the enforcement efforts are likely to speed up following some successful court cases on the part of the government.
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This story is from the CCH’s monthly Focus on Tax newsletter, which provides advise and guidance on federal and state tax issues for tax and accounting professionals.
Read this article from CCH’s Journal of Taxation of Financial Products.