On Sept. 24, 2004, the IRS removed a transaction involving a producer-owned reinsurance company from identification as a "listed transaction." The IRS will continue to scrutinize such transactions used to shift income to companies purporting to be insurance companies.
Notice 2004-65 (PDF 14K) — Certain reinsurance arrangements
Notice 2004-67 (PDF 29K) — "Listed Transactions" (revised)
The IRS partnership with state tax administrators had uncovered tens of millions of dollars in abusive transactions by early June 2004.
In February, the IRS provided 20,000 leads to state agencies, a number that has since grown to 28,000. This activity implements September 2003 agreements to share information on taxpayers involved in abusive tax avoidance transactions.
The tax administrators of Australia, Canada, the United Kingdom and the United States have created a joint task force to coordinate the fight against abusive tax transactions.
As 2003 drew to a close, the IRS and Treasury issued additional rules to halt abusive tax transactions.
At a hearing on Nov. 20, 2003, IRS Commissioner Everson responded to four questions about abusive tax shelter activity submitted by the Senate Governmental Affairs Committee's Permanent Subcommittee on Investigations (PDF 166K).
A November 2003 summary of steps taken by the IRS and Treasury in their ongoing crackdown on abusive tax shelters.
At an Oct. 21, 2003, Senate Finance Committee hearing on corporate tax shelters, IRS Commissioner Mark Everson testified about the agency's responses and initiatives regarding abusive tax transactions (PDF 171K).
In a Sept. 22, 2003, address at the Financial Services Industry Conference, Acting Chief Counsel Emily Parker explained why the alleged "Wall Street Rule" is not something for tax shelter promoters or investors to rely on ( PDF 94K).
Beginning with his nomination hearing, IRS Commissioner Mark Everson has expressed his concern about tax shelters and IRS enforcement activities.
IRS Deputy Chief Counsel (Operations) Emily Parker summarized recent IRS actions on abusive tax avoidance transactions in a June 6, 2003, address to the Texas Federal Tax Institute. (PDF 93K)
Two Revenue Procedures issued Feb. 27, 2003, will make tax shelter disclosures more useful and reduce taxpayer burden by providing that certain losses and certain book-tax differences are not taken into account in determining whether a transaction is reportable.
Treatment of losses: Rev. Proc. 2003-24 (PDF 79K)
Treatment of book-tax differences: Rev. Proc. 2003-25 (PDF 59K)
In a Feb. 25, 2003, speech, Chief Counsel B. John Williams explained the three foundations of the IRS/Treasury approach to stopping the proliferation of tax shelters and gave an update on the three settlement initiatives announced last October. (PDF 119K)
Chief Counsel B. John Williams explained the limits on attorney-client and tax practitioner privileges as regards tax shelter promoters in a June 6, 2002, address to the Texas Federal Tax Institute. (PDF 87K)