IRS Probes Tax Dodging In Derivatives Trades: Report

Law360, New York (July 20, 2007, 12:00 AM EDT) -- Two financial services firms have been asked by the Internal Revenue Service to release data in a probe on whether complex derivatives trades were designed to avoid taxes, according to published reports.

The IRS has sent so-called information document requests to investment banks Citigroup Inc. and Lehman Brothers Holdings Inc. calling for material on derivatives trades for clients, the Wall Street Journal reported Friday.

Citing people familiar with the matter, the report said the IRS was investigating whether these trades, executed for big hedge funds and...
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