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Page 1 of 4 Instructions for Form 8886-T 15:55 - 11-OCT-2007
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Department of the Treasury
Internal Revenue Service
Instructions for Form 8886-T
(September 2007)
Disclosure by Tax-Exempt Entity Regarding Prohibited Tax Shelter Transaction
Section references are to the Internal must be filed by the entity. If the • An Archer medical savings
Revenue Code unless otherwise noted. tax-exempt entity is a plan entity account.
(defined below), Form 8886-T must • A custodial account treated as an
General Instructions be filed by the entity manager annuity contract under section
(defined on page 2). 403(b)(7)(A).
Purpose of Form Note. If the entity is a fully • A Coverdell education savings
Certainbelow) aretax-exemptrequiredentitiesto file Form(defined self-directedother savingsqualifiedarrangement,plan, IRA,the entityor account.•A health savings account.
8886-T to disclose information with manager is the plan participant, See Temporary Regulations section
respect to each prohibited tax shelter beneficiary, or owner who approved 1.6033-5T for more information.
transaction to which the entity is a or caused the entity to be a party to Party to a prohibited tax shelter
party. See Prohibited tax shelter the prohibited tax shelter transaction. transaction. A tax-exempt entity is
transaction below. See Party to a a party to a prohibited tax shelter
prohibited tax shelter transaction transaction if it:
below to determine if the tax-exempt Definitions • Facilitates the transaction by
entity is a party to a prohibited tax Tax-exempt entity. A tax-exempt reason of its tax-exempt, tax
shelter transaction. See Temporary entity is an entity which is either a indifferent or tax-favored status;
Regulations section 1.6033-5T for plan entity (defined below) or a • Enters into a listed transaction and
more information. Form 8886-T is non-plan entity (defined below). the tax-exempt entity’s return (original
available for public inspection. Non-plan entity. Non-plan or amended) reflects a reduction or
A separate Form 8886-T must be entities are tax-exempt entities elimination of liability for applicable
filed for each prohibited tax shelter described in section 4965(c)(1), federal employment, excise, or
transaction. (c)(2), or (c)(3). The following unrelated business income taxes that
fortax-exemptprohibitedmanager(s)moretaxes FormIninformation,additionin connection4720,taxentitymaysheltertoReturnfilingbeand/orseewithliabletransaction.FormtheoftheentityCertainforinstructions8886-T,exciseFora sectionincludingUnitedtax-exempt•entities:•EntitiesAn organizationStates,501(c)adescribedstate,entitiesorthe501(d).aDistrictdescribedpossessionarein sectionnon-planofin170(c)of thetaxdescribedisthatprohibitedby•derivedIstype,consequenceslistsidentifiedclassthedirectlyintaxtransaction;theshelterorinpublishedpublishedrole,ororindirectlytaxtransaction.as aorstrategypartyguidanceguidance,fromto a
Excise Taxes Under Chapters 41 and Columbia, or a political subdivision of Prohibited tax shelter transaction.
42 of the Internal Revenue Code, and a state or possession of the United Generally, a prohibited tax shelter
the Instructions for Form 5330, States (but not including the United transaction is a transaction that is a
subsequently listed transaction), a
EmployeeReturn of ExciseBenefitTaxesPlans.Related to States).• An Indian tribal government. listed transaction (including
statementshelterA taxabletransactiontopartyany tax-exempttomusta prohibitedprovideentityatax sectioninformation.See Temporary1.6033-5T forRegulationsmore transactiontermsconfidentialprotection.on pagesSeewithtransaction,definitions1contractualand 2.orofa these
that is party to the transaction that the Plan entity. Plan entities are
transaction is a prohibited tax shelter tax-exempt entities described in Note. In general, if the IRS
transaction. See Tax-exempt entity section 4965(c)(4), (c)(5), (c)(6), or determines by published guidance
below. (c)(7). The following tax-exempt that a transaction will be excluded
requiredReportableinintax-exemptRegulationsanyIf a tax-exemptreportableto fileTransactionentitysectionFormtransactionalsoentity8886,may1.6011-4),Disclosureparticipatesbe(definedthe whichentitiestax•• sectionAnAunderplanannuityincludesare403(a)describedsectionplanplanoraentities:trustannuity501(a).describedin sectionexemptcontractin401(a)from ortransaction,transaction.fromprotection,consideredtransactionthe definitiontheaconfidentialprohibitedwithtransactionofcontractuallistedtaxtransaction,willshelternot be
Statement.the InstructionsFor morefor Forminformation,8886. see described• A qualifiedin sectiontuition program403(b). Listedtransactiontransaction.is a transactionA listedthat is the
described in section 529. same as or substantially similar to
Frequency of disclosure. A single • An eligible deferred compensation any of the types of transactions that
disclosure is required for each plan described in section 457(b) that the IRS has determined to be a tax
prohibited tax shelter transaction. is maintained by a governmental avoidance transaction and are
employer described in section identified by notice, regulation, or
Who Must File 457(e)(1)(A). other form of published guidance as a
If the tax-exempt entity is a non-plan • An individual retirement account. listed transaction. For existing
entity (defined below), Form 8886-T • An individual retirement annuity. guidance see:
Cat. No. 49104P