Treasury Dept. Plans to Track Shelters

The Bush administration announced a broad effort to track and combat tax shelters constructed by corporations and wealthy individuals.

The proposals by the Treasury Department were released ahead of a Senate Finance Committee hearing today on tax shelters. The committee also is investigating whether Enron Corp. escaped taxes by creating hundreds of offshore affiliates.

Actions the Treasury Department plans to take include strengthening requirements that these transactions are disclosed to the Internal Revenue Service and extending the rules beyond corporations to include partnerships, trusts and high-income individuals.

The package would simplify which transactions must be disclosed, impose stiffer civil penalties for failure to do so and no longer permit marketers of shelters to evade the rules by calling themselves “advisors” rather than “promoters” of such schemes.