A proposed settlement of lawsuits relating to the 1990s tax shelter craze was announced yesterday. The New York Times reports:
The accounting firm KPMG and a law firm have agreed to pay $195 million to as many as 280 wealthy investors who bought four types of questionable shelters, the first major step by the two firms to deal with billions of dollars in potential civil claims.
The settlement relates to tax shelters that led to recent indictments.
The settlment may be controversial, according to the Times:
At least one law firm representing tax shelter investors, Bernstein Litowitz Berger & Grossmann in New York, said yesterday that it intended to oppose the class-action civil settlement.
The firm said it did not like how the terms of settlement created four groups of class members, depending on the size and timing of their claims. Under the terms, class members can receive as little as 12½ percent of their losses or as much as 130 percent. The law firm also objects to the undisclosed payments to be made to a special master who will decide which groups class members belong to.
Link: NY Times article
The items included in the Tax Update Blog are informational only and are not meant as tax advice. Consult with your tax advisor to determine how any item applies to your situation.
Joe Kristan writes the Tax Update items, and any opinions expressed or implied are not necessarily shared by anyone else at Roth & Company, P.C. Address questions or comments on Tax Updates to