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Saving Taxes by Winning the Economic Substance Test

  • Broadcast in Business
Provocative Tax Planning

Provocative Tax Planning


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Creating wealth requires tax planning that looks down the road at new trends.  After the KPMG tax shelters, Congress passed a new law to codify the existing court case law.  For any tax plan to succeed, the plan must have economic substance and a profit motive (also known as a "business purpose").

But there is a problem.  These concepts are subjective based upon appearance.   This Tax Talk  will teach you how to win with the IRS. 

Establishing a profit motive is the key in avoiding the new economic substance and the large (40%) tax penalty.   The old hobby loss rules and court cases provide us with the knowledge needed for successful tax planning.

CPAs & attorneys, here is a link to our blog with the court cases.