Revised Corporate Tax Shelter Discussion Draft
February 14, 2001

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V. Section 6708(a): Failure to Maintain Lists

The Draft increases the penalty imposed on persons who fail to maintain lists of investors in tax shelters and abusive tax shelter devices to 50% of the gross proceeds derived from each person with respect to whom there is a failure. The $100,000 maximum limit on the penalty is not applicable in the case of a failure to maintain a list of investors in tax shelters and abusive tax shelter devices. We support the broadening of the penalty on failure to maintain investor lists. However, we believe that a statutory change to the investor list maintenance requirement in Code section 6112 is necessary to clarify that a tax advisor who is engaged in tax planning for a non-contingent hourly fee and who has no entrepreneurial stake in the transaction is not required to maintain investor lists.

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