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It's not the law, it's the lie.

September 10, 2009

This is a great short summary of the problems with the big-firm marketed tax shelters of the late '90s and early years of this decade:

The problem with these shelters, as I have noted earlier, is the lie. They, like many of the earlier shelters, had plausible – noncriminal – legal constructs; the problem was that the facts – often the economics – simply did not support the legal constructs.

A juror doesn't have to understand the Sec. 752 rules for allocating partnership debt to understand a lie. That may be the real danger for the defendants in the Jenkens and Gilchrist tax shelter prosecution.