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Abusive Shelters

Definitions

Abusive Tax Avoidance Transaction (ATAT)

An abusive tax avoidance transaction means any plan or arrangement devised for the principal purpose of evading federal income tax, and includes but is not limited to, "listed transactions" as defined by the IRS.

Abusive Tax Shelter

An “abusive tax shelter” or “tax shelter” are additional names for an "abusive tax avoidance transaction" (ATAT).

Listed transaction

Listed transactions are a type of a reportable transaction. A "listed transaction" is a transaction that is the same as or substantially similar to one that the IRS has determined to be a tax avoidance transaction and identified by IRS notice or other form of published guidance. The IRS maintains a list of these transactions on its website.

Material Advisor

A material advisor is a person who provides material aid, assistance, or advice with respect to organizing, managing, promoting, selling, implementing, insuring, or carrying out any reportable transaction, and who directly or indirectly derives income from these services in an amount that exceeds certain IRS defined thresholds. The IRS requires every material advisor to a reportable transaction to file federal Form 8918, Material Advisor Disclosure Statement. A material advisor can be an individual, trust, estate, partnership, or corporation.

Reportable transaction

A “reportable transaction” is one that the IRS requires to be separately disclosed under Treasury Regulations Section 1.6011-4T or 1.6011-4 because it has a higher potential to be a tax avoidance transaction. These are required to be reported to the IRS on federal Form 8886, Reportable Transaction Disclosure Statement. In general these transactions include: