Just because the idea of violating a patented tax strategy sounds ridiculous on its face doesn’t mean you won’t get sued for using it.Currently, some 65 tax patents have been issued, and 109 more are pending, according to Eileen Sherr, technical manager at the American Institute of CPAs’ Tax Division. “Many of these are common twists on everyday transactions,” observed Sherr, who attended a recent Internal Revenue Service hearing on the issue.
“There are several patents dealing with the use of charitable remainder trusts, and there’s one on deferred real estate exchanges under Code Sec. 1031,” she said. “These are fairly common little twists on transactions that people have been doing for years.”
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