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Department of the Treasury
Internal Revenue Service
Instructions for Form 8886-T

(December 2019)
Disclosure by Tax-Exempt Entity Regarding Prohibited Tax Shelter Transaction

Section references are to the Internal Revenue filed by the entity. If the tax-exempt entity • A Coverdell education savings account
Code unless otherwise noted. is a plan entity (defined below), Form as defined in section 530.
8886-T must be filed by the entity • A health savings account within the
General Instructions manager (defined on page 2). meaning of section 223(d).
• An ABLE program described in section
Note. If the entity is a fully self-directed 529A.
Future Developments qualified plan, IRA, or other savings See Regulations section 1.6033-5 for
For the latest information about arrangement, the entity manager is the more information.
developments related to Form 8886-T and plan participant, beneficiary, or owner who
the instructions, such as legislation approved or caused the entity to be a Party to a prohibited tax shelter trans-
enacted after they were published, go to party to the prohibited tax shelter action. A tax-exempt entity is a party to a
IRS.gov/Form8886-T. transaction. prohibited tax shelter transaction if it:
• Facilitates the transaction by reason of
its tax-exempt, tax indifferent, or
Purpose of Form Definitions tax-favored status;
Certain tax-exempt entities (defined
below) are required to file Form 8886-T to Tax-exempt entity. A tax-exempt entity • Is identified in published guidance, by
disclose information with respect to each is an entity which is either a plan entity type, class, or role, as a party to a
prohibited tax shelter transaction to which (defined below) or a non-plan entity prohibited tax shelter transaction. See
the entity is a party. See Prohibited tax (defined below). example in Regulations section
53.4965-4(c).
shelter transaction below. See Party to a Non-plan entity. Non-plan entities are
prohibited tax shelter transaction below to tax-exempt entities described in section Prohibited tax shelter transaction.
determine if the tax-exempt entity is a 4965(c)(1), (c)(2), or (c)(3). The following Generally, a prohibited tax shelter
party to a prohibited tax shelter tax-exempt entities are non-plan entities. transaction is a transaction that is a listed
transaction. See Regulations section • An organization described in section transaction (including subsequently listed
1.6033-5 for more information. Form 501(c) or 501(d). transaction), a confidential transaction, or
8886-T is available for public inspection. • Entities described in section 170(c) a transaction with contractual protection.
A separate Form 8886-T must be filed including a state, a possession of the See definitions of these terms on pages 1
for each prohibited tax shelter transaction. United States, the District of Columbia, or and 2.
In addition to filing Form 8886-T, a a political subdivision of a state or
tax-exempt entity and/or entity manager(s) possession of the United States (but not Note. In general, if the IRS determines by
may be liable for excise taxes in including the United States). published guidance that a transaction will
connection with the prohibited tax shelter • An Indian tribal government. be excluded from the definition of listed
transaction, confidential transaction, or
transaction. For more information, see the See Regulations section 1.6033-5 for transaction with contractual protection, the
Instructions for Form 4720, Return of more information. transaction will not be considered a
Certain Excise Taxes Under Chapters 41 Plan entity. Plan entities are prohibited tax shelter transaction.
and 42 of the Internal Revenue Code, and tax-exempt entities described in section Listed transaction. A listed transaction
the Instructions for Form 5330, Return of 4965(c)(4), (c)(5), (c)(6), (c)(7), or (c)(8). is a transaction that is the same as or
Excise Taxes Related to Employee The following tax-exempt entities are plan substantially similar to any of the types of
Benefit Plans. entities. transactions that the IRS has determined
A taxable party to a prohibited tax • A plan described in section 401(a) to be a tax avoidance transaction and are
shelter transaction must provide a which includes a trust exempt from tax identified by notice, regulation, or other
statement to any tax-exempt entity that is under section 501(a). form of published guidance as a listed
party to the transaction that the • An annuity plan described in section transaction. For existing guidance, see
transaction is a prohibited tax shelter 403(a) or annuity contract described in Notice 2009-59, 2009-31 I.R.B. 170 and
transaction. See Tax-exempt entity below. section 403(b). IRS.gov/Businesses/Corporations/Listed-
If a tax-exempt entity participates in • A qualified tuition program described in Transactions.
any reportable transaction (defined in section 529.
Regulations section 1.6011-4), the • An eligible deferred compensation plan Subsequently listed transaction. A
tax-exempt entity may also be required to described in section 457(b) that is subsequently listed transaction is a
file Form 8886, Reportable Transaction maintained by a governmental employer transaction that is identified in published
Disclosure Statement. For more described in section 457(e)(1)(A). guidance as a listed transaction after the
information, see the Instructions for Form • An individual retirement account within tax-exempt entity has entered into the
8886. the meaning of section 408(a). transaction and that was not a confidential
• An individual retirement annuity within transaction or transaction with contractual
Frequency of disclosure. A single the meaning of section 408(b). protection at the time the entity entered
disclosure is required for each prohibited • An Archer medical savings account into the transaction. See section 4965(e)
tax shelter transaction. within the meaning of section 220(d). (2) for more information.
• A custodial account treated as an Substantially similar. A transaction is
Who Must File annuity contract under section 403(b)(7) substantially similar to another transaction
If the tax-exempt entity is a non-plan entity (A). if it is expected to obtain the same or
(defined below), Form 8886-T must be

Jan 02, 2020 Cat. No. 49104P

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similar types of tax consequences and is Recordkeeping continues, not to exceed $54,000 for each
either factually similar or based on the The entity or entity manager must keep a required disclosure. In addition, the IRS is
same or similar tax strategy. Receipt of an copy of all documents and other records authorized to make a written demand on
opinion regarding the tax consequences related to a prohibited tax shelter the entity or entity manager specifying a
of the transaction is not relevant to the transaction. See Regulations section future date by which the required
determination of whether the transaction is 1.6001-1(c) and 53.6001-1 for more disclosure must be filed. If there is a failure
the same as or substantially similar to details. to comply with this demand, there is an
another transaction. Further, the term additional penalty in the amount of $105
substantially similar must be broadly per day after the expiration of the time
construed in favor of disclosure. See When To File specified in the demand, not to exceed
Regulations section 1.6011-4(c)(4) for General rules. Generally, the due date $10,500 for each required disclosure. In
examples. for filing Form 8886-T depends on whether the case of a non-plan entity (defined on
Confidential transaction. A confidential the tax-exempt entity is a party to a page 1), the penalty is imposed on the
transaction is a transaction that is offered prohibited tax shelter transaction to tax-exempt entity. In the case of a plan
under conditions of confidentiality and for reduce its own federal tax liability or, entity (defined on page 1), the penalty is
which a minimum fee (defined below) was alternatively, whether it is a party to such a imposed on the entity manager. These
paid to an advisor. A transaction is transaction to facilitate the transaction by penalties are adjusted for inflation. See
considered to be offered under conditions reason of its tax-exempt, tax indifferent, or section 6652(c) for more information on
of confidentiality if the advisor places a tax-favored status. penalties.
limitation on disclosure of the tax In the case of a tax-exempt entity that A penalty is assessed to the
treatment or tax structure of the is a party to a prohibited tax shelter tax-exempt entity (for a non-plan entity) or
transaction and the limitation on transaction because it facilitates the to the entity manager (for a plan entity) for
disclosure protects the confidentiality of transaction by reason of its tax-exempt, each failure to timely file Form 8886-T in
the advisor's tax strategies. The tax indifferent, or tax-favored status, Form accordance with its instructions and
transaction is treated as confidential even 8886-T must be filed on or before May 15 Regulations section 1.6033-5. Form
if the conditions of confidentiality are not of the calendar year following the close of 8886-T must be completed in its entirety
legally binding on the taxpayer. See the calendar year during which the with all required attachments to be
Regulations section 1.6011-4(b)(3) for tax-exempt entity entered into the considered complete. Do not enter
more information. prohibited tax shelter transaction. See “Information provided upon request,” or
section 1.6033-5(d)(1). “Details available upon request,” or any
Minimum fee. For a corporation, or a
partnership or trust in which all of the Entities identified as a party to a pro- similar statement in the space provided.
owners or beneficiaries are corporations hibited tax shelter transaction by pub- Inclusion of any such statements subjects
(looking through any partners or lished guidance. In the case of a the tax-exempt entity (for a non-plan
beneficiaries that are themselves partners tax-exempt entity that becomes a party to entity) or the entity manager (for a plan
or trusts), the minimum fee is $250,000. a prohibited tax shelter transaction entity) to penalty. See section 6652(c) for
For all others, the minimum fee is $50,000. because it is identified in published more information.
The minimum fee includes all fees paid guidance by type, class, or roles as a party
directly or indirectly for the tax strategy, to a prohibited tax shelter transaction, the Public Inspection
advice or analysis of the transaction published guidance will specify the due A completed Form 8886-T is available for
(whether or not related to the tax date of Form 8886-T. public inspection as required under
section 6104.
consequences of the transaction), Subsequently listed transaction. In the
implementation and documentation of the case of a tax-exempt entity that is a party
transaction, and tax preparation fees to to a prohibited tax shelter transaction Specific Instructions
the extent they exceed customary return because the transaction was
preparation fees. Fees do not include subsequently listed, Form 8886-T must be Name and Address
amounts paid to a person, including an filed by May 15 of the calendar year
advisor, in that person's capacity as a following the close of the calendar year Enter the name and address of the
party to the transaction. during which the transaction was identified tax-exempt entity. Include the suite, room,
Transaction with contractual protec- as a listed transaction. See section or other unit number after the street
tion. A transaction with contractual 1.6033-5(d)(2). address. If the Post Office does not deliver
mail to the street address, show the P.O.
protection is a transaction for which a box number instead of the street address.
participant (or related party as defined Where To File The name and address should be the
under section 267(b) or 707(b)) has the Send the return to the: same as shown on other forms filed with
right to a full refund or partial refund of the IRS.
fees if all or part of the intended tax Department of the Treasury
consequences from the transaction are Internal Revenue Service Center
not sustained. It also includes a Ogden, UT 84201-0027 Employer Identification
transaction for which fees are contingent Number (EIN)
on the realization of tax benefits from the Enter the employer identification number
transaction. For exceptions and other Penalties of the tax-exempt entity. In the case of a
details, see Regulations section There is a monetary penalty under section fully self-directed qualified plan, or an IRA
1.6011-4(b)(4) and Rev. Proc. 2007-20. 6652(c) for the failure to disclose (or other savings arrangement) that does
information required under section not have and is not required to obtain an
Entity manager. In the case of a plan 6033(a)(2) with respect to a prohibited tax EIN, leave the EIN box blank. Do not enter
entity, entity manager means the person shelter transaction. The penalty for failure a social security number.
who approves or otherwise causes the to include information with respect to a
tax-exempt entity to be a party to the prohibited tax shelter transaction is $105
prohibited tax shelter transaction. See for each day during which such failure
section 4965(d)(2).

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Who Must Sign form. If the transaction is substantially out the Internal Revenue laws of the
similar to a listed transaction, check the United States. You are required to give us
Non-plan entity. The director, trustee, box next to “listed transaction.” See the information. We need it to ensure that
officer, or other official authorized to sign Substantially similar on page 2. If you you are complying with these laws and to
for the non-plan entity (defined on page 1) checked the listed transaction box, you allow us to figure and collect the right
must sign Form 8886-T. must also identify the transaction on line 3. amount of tax. You are not required to
provide the information requested on a
Plan entity. For plan entities (defined on If the transaction is a listed
form that is subject to the Paperwork
page 1), the entity manager (defined on ! transaction or substantially similar Reduction Act unless the form displays a
page 2) must sign Form 8886-T. CAUTION to a listed transaction, you must
valid OMB control number. Books or
check the listed transaction box in addition
records relating to a form or its instructions
How To Complete to any others that may apply.
must be retained as long as their contents
Form 8886-T may become material in the administration
In order to be considered complete, Form Line 3 of any Internal Revenue law. Generally,
8886-T must be completed in its entirety If you selected “listed transaction” on tax returns and return information are
with all required attachments. Do not line 2, provide a brief identifying confidential, as required by section 6103.
simply write “See Attached.” If the description of the listed transaction and However, certain returns and return
information required exceeds the space identify the notice, revenue ruling, information of tax-exempt organizations
provided, complete as much information regulation (for example, Regulations and trusts are subject to public disclosure
as possible in the available space and section 1.643(a)-8 or Notice 2003-81 and inspection, as provided by section
attach the remaining information on modified and supplemented by Notice 6104. The time needed to complete and
additional sheets. The additional sheets 2007-71, 2007-35 I.R.B. 472), file this form will vary depending on
must be in the same order as the lines to announcement, or other published individual circumstances. The estimated
which they correspond. You must also guidance that identified the listed burden for tax-exempt organizations filing
include the entity name and identifying transaction. For guidance identifying listed this form is approved under OMB control
number at the top of each additional transactions, see Notice 2009-59, number 1545-0047 and is included in the
sheet. 2009-31 I.R.B. 170. For further updates, estimates shown in the instructions for
go to IRS.gov/Businesses/Corporations/ their information return.
Line 1 Listed-Transactions. If you have comments concerning the
Check the box which indicates the type of accuracy of these time estimates or
tax-exempt entity that is a party to a Line 4 suggestions for making this form simpler,
prohibited tax shelter transaction. Provide the complete names and we would be happy to hear from you. You
addresses of all other parties (whether can send us comments from IRS.gov/
Line 2 taxable or tax-exempt) to the transaction, FormComments. Or you can write to the
Check the box for all categories that apply if known. If you need additional space, Internal Revenue Service, Tax Forms and
to the transaction being reported. The attach separate sheets. At the top of each Publications Division, 1111 Constitution
categories of prohibited tax shelter additional sheet, write “Line 4” and enter Ave. NW, IR-6526, Washington, DC
transactions (listed, confidential, and the tax-exempt entity's name and 20224. Don’t send the form to this office.
transaction with contractual protection) identifying number. Instead, see Where To File, on page 2.
are described on pages 1 and 2. Do not
report more than one transaction on this Paperwork Reduction Act Notice. We
ask for the information on this form to carry

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