Letter to the Editor ¦ August 24, 2000
Skullduggery Control

By David Langer

Your page-one article on Aug. 21 ("How New Tax Shelter Promised Big Savings But Finally Fell Apart") describes in detail how an odorous tax shelter was promoted by PricewaterhouseCoopers and was shot down by an alert congressman, Lloyd Doggett of Texas. The article also lists other questionable shelters.

The solution to this skullduggery is very simple: IRS needs to set up a review panel and require that any tex shelter be submitted to it for review and approval before the scheme can be used. An approved shelter will then be subject to periodic review. This approach has long applied to qualified penion and profit-sharing plans. One guideline should be that an arrangement that cannot be readily understood by the panel will not be approved, since highly complex instruments lend themselves too easily to "interpretation."

- David Langer, a consulting actuary and president of David Langer Co., Inc.
New York