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Tax Law Roundup current law developments in U.S. taxation

Tag Archives: losses

Tax Court Slams “DAD” Loss Importation Shelter

Posted in Economic Substance, Partnership/LLC, Tax Shelters

In Superior Trading LLC v. Commissioner, the Tax Court denied losses and imposed penalties on the “Distressed Asset/Debt” tax shelter, otherwise known as the “DAD” shelter.  The IRS previously described this transaction in a 2007 Coordinated Issue Paper.  The DAD transaction involves a tax-indifferent party contributing built-in loss assets, in this case Brazilian consumer receivables,… Continue Reading