Hawaii Administrative Rules
Title 18 - DEPARTMENT OF TAXATION
Chapter 231 - ADMINISTRATION OF TAXES
ADMINISTRATIVE GUIDANCE APPLICABLE TO CERTAIN PENALTIES AND FINES
Section 18-231-36.7-01-6700 - Guidance, promoting abusive tax shelters; conformity to treasury regulations related to Internal Revenue Code section 6700
Current through February, 2024
(a) In administering the penalty set forth under section 231-36.7, HRS, relating to imposition of a penalty for promoting abusive tax shelters, any proposed, temporary, or final treasury regulations providing guidance in application of section 6700 of the Internal Revenue Code shall be operative.
(b) The director may provide additional administrative guidance pursuant to Tax Information Release.
(c) The director may maintain a list of transactions considered by the department to be abusive tax shelters. This list shall be maintained by Tax Information Release and shall be updated from time to time, as is necessary.
(d) Safe harbor. A person who promotes a tax shelter that may or may not be considered abusive by the department will not be assessed the penalty under section 231-36.7, HRS, if the promoter first makes application with the department for a letter ruling pursuant to Tax Information Release 2009-1, and who thereafter receives a favorable ruling from the department. A ruling will not be considered a favorable ruling within the meaning of this safe harbor unless all partnership agreements, operating agreements, investment plan documents, and other relevant information discussing the organization of the plan are acknowledged in the ruling as having been disclosed and considered by the department in drawing its conclusion.
(e) Action to enjoin a tax shelter promoter. Section 231-36.7(c), HRS, authorizes the director to seek an injunction from a court enjoining a tax shelter promoter from engaging in any conduct described under section 231-36.7(a), HRS. A civil action to enjoin a tax shelter promoter shall be subject to the following procedures:
