Southgate Master Fund: The Sham Partnership Doctrine Gets Messy… Or Does It?

By Jonathan Prokup Two weeks ago, the Fifth Circuit summarily rejected a taxpayer request for an en banc rehearing in Southgate Master Fund LLC v. United States.  The appellate court had previously concluded that the taxpayer was not entitled to a claimed capital loss from a transaction involving the acquisition of distressed debt via a … Continue reading Southgate Master Fund: The Sham Partnership Doctrine Gets Messy… Or Does It?

Will IRS Limit Exam’s Assertion of the Economic Substance Penalty? TIGTA Report Suggests Not.

Since codification of the economic substance doctrine in March 2010, taxpayers have expressed fears that IRS will assert the doctrine unpredictably, resulting in an in terrorem effect among taxpayers because of the lack of clear authorities interpreting the doctrine and the new 40% strict-liability penalty for falling on the wrong side of it.  To promote … Continue reading Will IRS Limit Exam’s Assertion of the Economic Substance Penalty? TIGTA Report Suggests Not.