U.S. Treasury and IRS to Close Major Tax Loophole for Wealthy Taxpayers, Raising $50 Billion Over a Decade

Jun 17, 2024, 02:26 PM

The U.S. Treasury Department and the Internal Revenue Service (IRS) have announced a new initiative to close a major tax loophole used by large partnerships. This move is part of the Biden administration's broader effort to limit tax dodging and is expected to generate more than $50 billion in revenue over the next decade. The loophole, known as 'partnership basis shifting,' allows wealthy taxpayers to move assets among related parties to avoid taxes. By tightening the rules, the IRS aims to prevent complex partnerships from inflating tax deductions, thereby increasing audit rates for large businesses and complex entities. The announcement was made on Monday and targets wealthy filers.