Predicated on a tax court case, one of the below doctrines was disallowed. What strategy was employed and how was it conducted. based on several important doctrines. 1. The assignment of income doctrine - states that income must be taxed to the entity that renders the service or owns the capital with respect to which the income is paid. 2. The economic substance doctrine - holds that a transaction that changes the taxpayers economic situation only for the tax savings from the transaction can be disregarded by the IRS. 3. The business purpose doctrine - a transaction should not be effective or allowed for tax purposes unless it has a business purpose other than tax avoidance. 4. The step transaction doctrine - allows the IRS to collapse a series of intermediate transactions into a single transaction to determine the tax consequences of the arrangement in its entirety US Tax laws are based on several important doctrines.

The income doctrine - states that income must be taxed to the entity that renders the service or owns the capital with respect to which the income is paid. The economic substance doctrine - holds that a transaction that changes the taxpayers economic situation only for the tax savings from the transaction can be disregarded by the IRS. The business purpose doctrine - a transaction should not be effective or allowed for tax purposes unless it has a business purpose other than tax avoidance. The step transaction doctrine - allows the IRS to collapse a series of intermediate transactions into a single transaction to determine the tax consequences of the arrangement in its entirety. To perform professional tax planning, we adhere to several maxims. First we need to analyze the variables that determine the tax consequences of a transaction. Then we apply one or more of the following tax planning maxim strategies that reduce tax and enhance cash flows: Generate income in a lower tax rate entity tax costs decrease. Defer taxes - shift income to a future year when rates are lower, or move expenses forward to the current year when tax rates are higher or they can decrease income. Generate income in a lower tax jurisdiction - tax costs decrease when income is taxed at a lower tax rate. Change the character of the revenue - tax costs decrease when income is taxed at a preferential rate because of its character.