Background on Tax Shelters: Scheduled for a Hearing Before the Subcommittee on Oversight of the Internal Revenue Service of the Committee on Finance, on June 24, 1983
U.S. Government Printing Office, 1983 - Tax shelters - 37 pages
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accelerated accordance accounting accrual accrued activities allocation allowed amount apply at-risk rules attributable avoid basis bond borrowed capital capital gains cash charitable claimed close Commissioner computed contract contribution conversion corporation cost Court deductions deferred depreciation determined dividend earnings economic effect ERTA example exception excess exchange expense extent fair market value farming finance foreign corporation fund future gain gems held holding income tax incurred individual interest Internal investment investors issue lease liability limited loan loss ment method nonrecourse obligations obtain ordinary income original paid partner partnership payments penalty percent period portion position prepaid present law present value prior promoter purchase received recovery reduce regulations result rules seller selling Service shares short-term straddle substantial tax benefits tax shelter tax-shelter investments taxable taxpayer tion traded transactions treated treatment
Page 18 - There shall be allowed as a deduction all interest paid or accrued within the taxable year on indebtedness.
Page 31 - ... the fair market value of such an Item of property is the price at which the item or a comparable item would be sold at retail.
Page 13 - A substantial understatement of income tax exists if the understatement for the taxable year exceeds the greater of 10 percent of the tax required to be shown on the return for the taxable year, and $5,000 ($10,000 for corporations other than S corporations and personal holding companies).
Page 21 - The effective rate of interest is a measure of the cost of credit, expressed as a yearly rate, that relates the amount and timing of values received to the amount and timing of payments made; it is thus a reflection of the cost of the amount borrowed for the time it is actually available. The effective rate of interest...
Page 26 - ... liable to the partnership to restore any deficit in their capital. If there is a change of partnership interests during the year, items are allocated to a partner for that part of the year he or she is a member of the partnership. Thus, a partner who acquires an interest late in the year is barred from deducting partnership expenses incurred prior to his entry into the partnership. If the partners agree to give an incoming partner a disproportionate share of partnership losses for...
Page 26 - No gain or loss shall be recognized on the exchange of property held for productive use in a trade or business or for investment...
Page 13 - ... a statement with respect to the allowability of any deduction or credit, the excludability of any income, or the securing of any other tax benefit by reason of holding an interest in the entity or participating in the plan or arrangement which the person knows or has reason to know is false or fraudulent as to any material matter, or "(B) a gross valuation overstatement...
Page 30 - The fair market value is the price at which the property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of relevant facts.
Page 31 - ... fair market value is the price which the taxpayer would have received if he had sold the contributed property in the lowest usual market in which he customarily sells, at the time and place of the contribution (and in the case of a contribution of goods in quantity, in the quantity contributed).