The New York Times and Wall Street Journal report today that the IRS has moved in Notice 2007-48 to stop the "Killer B" corporate tax shelter deployed by IBM to save over $1.6 billion in income tax. IBM used a foreign subsidiary to buy back shares through foreign exchanges. The subsidiary then used the shares to pay its corporate parent in America for goods and services.  The shelter is intended to circumvent the § 367(b) rules on repatriated earmings.  See:

• New York Times:  IRS Moves to Close Tax Shelter Shortly After I.B.M. Uses It to Save $1.6 Billion, by David Cay Johnston
• Wall Street Journal:  IBM’s Under-the-Wire Tax Break: IRS Closes Loophole Days After Firm’s Transaction Saved About $1.6 Billion, by William M. Bulkeley