Peter L. Klenk, Esq., J.D. LL.M. Tax

Tax Shelters look too good to be true because they usually are. Throughout my career there have been techniques and ploys that have been widely advertised that have resulted in jail, legal fees and tax penalties for those that abuse them. Caution must be the rule whenever investigating an income, estate or gift tax technique held out as a “Tax Shelter.”

The most recent casualty is described in the November 17th issue of the New York Times. Reporter Lynnley Browning described how federal prosecutors have obtained indictments against a tax-trained lawyer, John B. Ohle, III, claiming that he sold questionable tax shelters. Mr. Ohle has an impressive resume, having been an executive at Bank One, and the indictment includes well-respected Deutsche Bank. Deutsche Bank stands accused of arranging the financial transactions sold by Mr. Ohle.

Lynnley reports that the shelter “…allowed wealthy clients to falsely generate bogus tax losses of nearly $430 million, and to evade taxes of $103 million.” According to Lynnley, who obtained his information from the indictment, Mr. Ohle stands accused of selling 36 shelters in 2001.

Some techniques exist that do reduce income, estate and inheritance taxes, but the buyer must be aware! Verify that the technique that you are using is well established and that the legal fight that might exist to validate the technique has already been fought. Ask questions and get the advice of more than one attorney or accountant.

Estate Tax, Gift Tax and Inheritance Taxes are the taxes our firm addresses in the greater Philadelphia area… including all of New Jersey… as well as in Florida and New York. If you have any questions about a technique, please contact us.