SECTION 1. PURPOSE AND

BACKGROUND

This notice clarifies Notice 2001–16, 2001–1 C.B. 730, and supersedes Notice 2008–20, 2008–6 I.R.B. 406, regarding Intermediary Transaction Tax Shelters. Notice 2001–16 identified the Intermediary Transaction Tax Shelter (hereafter, an “Intermediary Transaction”) as a listed transaction under § 1.6011–4(b)(2) of the Income Tax Regulations. For purposes of this notice, an Intermediary Transaction is defined in terms of its plan and in terms of more objective components. Under this notice, a transaction is treated as an Intermediary Transaction with respect to a particular person only if that person engages in the transaction pursuant to the Plan (as defined in sections 2 and 4), the transaction contains the four objective components indicative of an Intermediary Transaction set forth in section 3, and no safe harbor exception in section 5 applies to that person. A transaction may be an Intermediary Transaction with respect to one person and not be an Intermediary Transaction with respect to another person. This notice does not affect the legal determination of whether a person’s treatment of the transaction is proper or whether such person is liable, at law or in equity, as a transferee of property in respect of the unpaid tax obligation described in section 3.

2008–51 I.R.B. 1299 December 22, 2008