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District Court: Anti-“Son of Boss” Regs Cannot Be Applied Retroactively

Paul Caron

In Klamath Strategic Investment Fund LLC v. United States, No. 5:04-CV-278 (E.D. Tex. 7/20/06), Federal District Court for the Eastern District of texas today held that the IRS abused its discretion in retroactively banning the "Son of Boss" tax shelter.  The court ruled that the anti-"Son of Boss" regulations do not apply to taxpayers that invested in the tax shelters prior to the August 2000 effective date of the regulations.  (Hat Tip:  Ellen Aprill.)

Update:  Press Reports:

About the Author

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Paul Caron
Paul Caron was named Duane and Kelly Roberts Dean of Pepperdine University School of Law on June 1, 2017. Dean Caron joined the Pepperdine faculty in 2013 after serving as the Dorothy and Leonard Straus Distinguished Visiting Professor of Law in the spring semesters of 2010 through 2013. He served as Associate Dean for Research and Faculty Development at Pepperdine in 2015-2017. Before coming to Pepperdine, he was Associate Dean of Faculty and Charles Hartsock Professor of Law at the University of Cincinnati College of Law.
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