Treasury regulations require that certain tax shelters and transactions be registered and that lists of investors be maintained by parties who organize or sell interests in the shelter(s). Investors in certain shelters and transactions are required to disclose their participation on their tax returns.

Types of Reportable Transactions:

  • Listed Transactions – A transaction that is the same as or substantially similar to one of the types of transactions that the Internal Revenue Service (IRS) has determined to be a tax avoidance transaction and identified by notice, regulation, or other form of published guidance as a listed transaction.
  • Confidential – Transactions that are offered to a taxpayer under conditions of confidentiality and the taxpayer has paid a minimum advisor fee.
  • Contractual Protection – Transactions that are offered with the right to full or partial refund of fees if the IRS does not allow the tax benefit of the transaction.
  • Loss Transactions – Certain loses under IRC §165.
  • Transactions of Interest (TOI) – Transactions that the IRS and the Treasury Department believe to have  the potential for tax avoidance or evasion, but lack sufficient information to determine whether the transaction should be identified specifically as a tax avoidance transaction. The TOI category of reportable transactions applies to transactions entered on or after November 2, 2006.
  • Virtual Currencies – Virtual currency transactions are taxable by law just like transactions in any other property. Taxpayers transacting in virtual currency may have to report those transactions on their tax returns.

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