Tax division issues exposure draft of interpretation on tax planning.

• Position: Tax info

The AICPA Tax Executive Committee recently voted to expose for comment Interpretation No. 1-2, "Tax Planning," of Statement on Standards for Tax Services No. 1, Tax Return Positions.

Statements on standards for tax services are enforceable standards that govern the conduct of members of the AICPA in tax practice. A significant area of many members' tax practices involves assisting taxpayers in tax planning. An area of recurring controversy has been the increase in transactions that are potentially abusive tax shelters. Taxing authorities, courts, the AICPA, and other professional organizations have straggled with defining and regulating these transactions.

Crucial in the debate about the appropriate means of addressing tax shelters has been the recognition that it may be difficult to clearly delineate the scope of transactions that are considered tax shelters in a way that will discourage abuse. At the same time, it must be recognized that taxpayers have a legitimate interest...