¹TD 9017, 9018 (10/22/02).

²TD 8875, 8876, 8877 (2/28/00), amended by TD 8896 (8/16/00), TD 8961 (8/02/01) and TD 9000 (6/14/02).

³TD 8877 (2/28/00); REG-103735-00 (2/28/00).

⁴TD 8875 (2/28/00); REG-103736-00 (2/28/00).

⁵TD 8876 (2/28/00); REG-110311-98 (2/28/00).

⁶See The Treasury Departments Enforcement Proposals for Abusive Tax Avoidance Transactions (3/20/02) (available at www.ustreas.gov/press/releases/po2018.htm, hereinafter, March 2002 Treasury Proposals), in which Treasury comments that the rules in Section 6011, 6111, and 6112 of the Code do not contain a consistent definition of a transaction that must be disclosed and registered, and for which investor lists must be maintained. While this situation is due, in part, to differing statutory requirements, it also reflects the desire, when these rules were drafted, to exclude legitimate business transactions and minimize taxpayer administrative burden. The result, unfortunately, is a set of elegantly constructed, but complicated, rules.

⁷TD 8896 (8/16/00).

⁸TD 8961 (8/2/01).

⁹TD 9000 (6/14/02).

¹⁰IR 2002-99.

¹¹See the preamble to TD 9017, note 1 supra.

¹²See Mendelson and Jones, Corporate Tax Shelter Regulations: How Do We Comply?, 27 J. Corp. Tax 292 (Oct. 2000).

¹³It is unclear how a disclosure obligation will be administered as to pension and exempt organization excise taxes.

¹⁴See Nijenhuis, Chung and Kulikov, The New Disclosure And Listing Regulations For Tax Shelters, 97 Tax Notes 943 (11/18/02).

¹⁵See March 2002 Treasury Proposals, note 6 supra.

¹⁶See AICPA Comments on Temporary and Proposed Regulations, Sections 1.6011-4T, 301.6111-2T, 301.6112-1T (12/26/02).

¹⁷See comments submitted Dec. 2, 2002, by the Hartford Insurance Co. to the IRS, BNA Daily Tax Report (12/11/02), requiring disclosure of a transaction, simply because of contractual protection will have a chilling effect on the tax industry, which will be detrimental to our economy. In addition, they assert that the tax insurance industry does not underwrite tax shelters, and that by refusing to insure tax shelters, abusive schemes and weakly supported tax positions, the tax insurance industryhelps to cultivate a culture of tax compliance

¹⁸See note 14, supra.

¹⁹See the Securities Industry Associations comments (5/8/02) (available at www.sia.com) and the U.S. Securities Markets Coalitions comments (7/15/02) on the March 2002 Treasury Proposals, note 6 supra.

²⁰In general, Sec. 162 allows a deduction for ordinary and necessary expenses paid or incurred during the tax year in carrying on any trade or business. In general, Sec. 165(a) allows a deduction for any loss sustained during the tax year not compensated for by insurance or otherwise.

²¹The authors understand that this suggestion may not be as revealing as GAAP in some instances, but GAAP also contemplates alternative treatments for various items. Insurance companies, for example, keep their books on a statutory basis and GAAP, but prepare returns from statutory books.

²²See comments submitted June 27, 2002, by the ABA Tax Section (hereinafter, ABA Comments) to Pamela F. Olson, Charles O. Rossotti and B. John Williams, on the March 2002 Treasury Proposals, note 6 supra (available at www.abanet.org.).

²³See the ABA Comments, id., at n. 22: we would treat all temporary timing differences of less than 2 years as not reportable. We would also not treat as reportable any book/tax difference attributable to the use of purchase accounting for a tax-free acquisition or that relates to an exclusion of income under Sections 101 through 138, Section 1031 or Section 1033 of the Code. The ABA recommended that the IRS specify those book-tax differences about which it was concerned in future regulations, or other administrative pronouncements.

²⁴See note 16, supra.

²⁵See Comments submitted May 22, 2002, by the NYSBA to Pamela F. Olson and Charles O. Rossotti, on the March 2002 Treasury Proposals, note 6, supra (available at www.nysba.org).

²⁶See note 22, supra.

²⁷See PricewaterhouseCoopers comments on Oct. 22, 2002 Modifications.

²⁸See the preamble to TD 9017, note 1 supra. The IRS and Treasury specifically requested comments on the exceptions and whether other exceptions should be provided.

²⁹See note 16, supra.

³⁰See Compaq Computer Corp, 277 F3d 778 (5th Cir. 2001) and IES Industries Inc., 253 F3d 350 (8th Cir. 2001) (IES). In Compaq, the taxpayer executed a trade on the New York Stock Exchange (NYSE) to buy American Depository Receipts (ADR) shares of Royal Dutch Petroleum Company cum-dividend, and immediately thereafter executed another trade on the NYSE to sell the same ADRs ex-dividend. All trades were completed in little over an hour. In IES, the taxpayer engaged in similar ADR trades that occurred within hours of each other, and sometimes in Amsterdam when the U.S. and European markets were closed.

³¹Sec. 901(k) does not allow an FTC for any withholding on a dividend with respect to stock in a corporation if such stock is held by the dividend recipient for 15 days or less.