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seventy five percent” of an investor’s tax savings, while the
other twenty-five percent of the tax savings is “a thirty percent
return on investment.” This arrangement purportedly provided
protection to investors: “If the cows do die and the sky falls
in, you have still made a return on the investment, and no matter
what happens you are always better off than if you paid taxes.”
After an explanation of the tax benefits, the document asked:
“Now, can you feel good about not paying taxes, and feeling like
you were not, somehow, abusing the system, or doing something
illegal?”
A section of the “1,000 lb. Tax Shelter” document that was
devoted to a discussion of audits by the IRS, stated that the
partnerships would be “branded an ‘abuse’ by the Internal Revenue
Service and will be subject to automatic” and “constant audit”.
Statements in the document compared the IRS to children, stating
that IRS employees did not have the “proper experience and
training” and “working knowledge of concepts required by the
Internal Revenue Code” to evaluate the partnerships. In a
section of the document titled “Tax Aspects”, the following
“warning” was given:
Out here, tax accountants don’t read brands, and our cowboys
don’t read tax law. If you don’t have a tax man who knows
you well enough to give you specific personal advice as to
whether or not you belong in the cattle business, stay out.
The cattle business today cannot be separated from tax law
any more than cattle can be separated from grass and water.
Don’t have anything to do with any aspect of the cattle
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Last modified: May 25, 2011