The IRS says tax shelter penalties are too tough. No joke.
Janet Novack, in Forbes magazine’s latest OutFront column, reports that IRS Chief Counsel Donald Korb believes the penalty for abusive tax shelters and transactions is so draconian that he’s loath to add new ploys to the list.
Instead, Korb has adopted a new category of questionable shelters, "transactions of interest," which carry a penalty that’s only a fraction of the amount assessed for not reporting an abusive shelter. The IRS also has the option to waive this penalty.
"You just can’t have a system where there’s no discretion," Korb told Forbes.
That attitude doesn’t sit well with the ranking Republican on the Senate Finance Committee. "The IRS doesn’t get to pick and choose which laws to enforce," said Iowa Senator Charles Grassley.
