26 U.S.C. § 7408

Actions to enjoin specified conduct related to tax shelters and reportable transactions

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(a) Authority to seek injunction

A civil action in the name of the United States to enjoin any person from further engaging in specified conduct may be commenced at the request of the Secretary. Any action under this section shall be brought in the district court of the United States for the district in which such person resides, has his principal place of business, or has engaged in specified conduct. The court may exercise its jurisdiction over such action (as provided in section 7402(a)) separate and apart from any other action brought by the United States against such person.

(b) Adjudication and decreeIn any action under subsection (a), if the court finds—(1) that the person has engaged in any specified conduct, and(2) that injunctive relief is appropriate to prevent recurrence of such conduct,the court may enjoin such person from engaging in such conduct or in any other activity subject to penalty under this title.(c) Specified conductFor purposes of this section, the term “specified conduct” means any action, or failure to take action, which is—(1) subject to penalty under section 6700, 6701, 6707, or 6708, or(2) in violation of any requirement under regulations issued under section 330 of title 31, United States Code.(d) Citizens and residents outside the United States

If any citizen or resident of the United States does not reside in, and does not have his principal place of business in, any United States judicial district, such citizen or resident shall be treated for purposes of this section as residing in the District of Columbia.

(Added Pub. L. 97–248, title III, § 321(a), Sept. 3, 1982, 96 Stat. 612; amended Pub. L. 98–369, div. A, title I, § 143(b), July 18, 1984, 98 Stat. 682; Pub. L. 108–357, title VIII, § 820(a), (b)(1), Oct. 22, 2004, 118 Stat. 1585.)Editorial NotesPrior Provisions

A prior section 7408 was renumbered section 7410 of this title.

Amendments

2004—Pub. L. 108–357, § 820(b)(1), amended section catchline generally, substituting “Actions to enjoin specified conduct related to tax shelters and reportable transactions” for “Action to enjoin promoters of abusive tax shelters, etc.”

Subsecs. (a) to (d). Pub. L. 108–357, § 820(a), added subsecs. (a) to (c), redesignated former subsec. (c) as (d), and struck out former subsecs. (a) and (b), which authorized a civil action to enjoin any person from further engaging in conduct subject to penalty under section 6700 or 6701 of this title and authorized the court, if it found that the person had engaged in such conduct and that injunctive relief was appropriate, to enjoin such person from engaging in such conduct or in any other activity subject to penalty under section 6700 or 6701.

1984—Subsec. (a). Pub. L. 98–369, § 143(b)(1), (2), inserted “or section 6701 (relating to penalties for aiding and abetting understatement of tax liability)” and inserted reference to section 6701 at end of second sentence.

Subsec. (b). Pub. L. 98–369, § 143(b)(1), (3), inserted “or section 6701 (relating to penalties for aiding and abetting understatement of tax liability),” in par. (1) and inserted reference to section 6701 at end.

Statutory Notes and Related SubsidiariesEffective Date of 2004 Amendment

Pub. L. 108–357, title VIII, § 820(c), Oct. 22, 2004, 118 Stat. 1585, provided that: “The amendment made by this section [amending this section] shall take effect on the day after the date of the enactment of this Act [Oct. 22, 2004].”

Effective Date of 1984 Amendment

Amendment by Pub. L. 98–369 effective on day after July 18, 1984, see section 143(c) of Pub. L. 98–369, set out as a note under section 6700 of this title.

Effective Date

Pub. L. 97–248, title III, § 321(c), Sept. 3, 1982, 96 Stat. 612, provided that: “The amendments made by this section [enacting this section] shall take effect on the day after the date of the enactment of this Act [Sept. 3, 1982].”

Notes of Decisions

Cited in 84 cases (9 in the last 5 years), 1983–2026 · leading case: United States v. Stover, 650 F.3d 1099 (8th Cir. 2011).

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United States v. Stover, 650 F.3d 1099 (8th Cir. 2011). · cites it 7× “The United States brought this civil action under 26 U.S.C. § 7408 to enjoin A. Blair Stover, Jr.”

United States v. Turner, 601 F. Supp. 757 (E.D. Wis. 1985). · cites it 9× “This is an action by which the United States Government seeks to enjoin the defendants from engaging in conduct relative to the promotion of abusive tax shelters, pursuant to 26 U.S.C. § 7408 . The Court transferred this case to Magistrate Aaron E.”

United States v. Conces, 507 F.3d 1028 (6th Cir. 2007). · cites it 2× “, Conces’s assertion that the default judgment and permanent injunction rested upon false or disputed allegations, as well as his contention that, contrary to the allegations of the complaint, the Government failed to secure the requisite approval of the Secretary of the…”

United States v. Daniel J. Gleason, Individually & D/B/A Tax Toolbox, Inc., & My Tax Man, Inc., 432 F.3d 678 (6th Cir. 2005). · cites it 3× “§ 6700 and 26 U.S.C. § 7408 , from selling the Tax Toolbox, a collection of pamphlets, record-keeping aids, a CD-Rom, and other information, and from providing services to Tax Toolbox customers.”

United States v. Thurston Paul Bell, 414 F.3d 474 (3rd Cir. 2005). · cites it 2× “” 26 U.S.C. § 7408 (b). "Specified conduct” is defined as "any action, or failure to take action, which is — (1) subject to penalty under section 6700 [relating to penalty for promoting abusive tax shelters, etc.”

United States v. Benson, 561 F.3d 718 (7th Cir. 2009). · cites it 2× “” 26 U.S.C. § 7408 (b). 1. Violation of 26 U.”

United States v. Rapower-3, LLC, 343 F. Supp. 3d 1115 (D. Utah 2018). · cites it 3× “Conclusions of Law One of the statutes under which the United States seeks an injunction is 26 U.S.C. § 7408 . Section 7408(a) authorizes a district court to enjoin any person from engaging in conduct subject to penalty under 26 U.”

United States v. Stinson, 239 F. Supp. 3d 1299 (M.D. Fla. 2017). · cites it 2× “§ 7407 , 26 U.S.C. § 7408 , and 26 U.S.C. § 7402 , only one of which requires proof of fraud.”

United States v. RaPower-3, 960 F.3d 1240 (10th Cir. 2020). “Injunctive and Equitable Relief The district court ruled that injunctive and other equitable relief was appropriate under 26 U.S.C. § 7408 (which authorizes the government to seek injunctive relief to prevent ongoing conduct subject to penalty under § 6700 and other specified…”

United States v. Gordon S. Buttorff, 761 F.2d 1056 (5th Cir. 1985). · cites it 2× “26 U.S.C. § 7408 . We affirm. FACTS AND PROCEEDINGS BELOW Approximately ten years ago appellant, Gordon S.”

United States v. David White, Individually & Doing Bus. as Minnesota Soc'y for Educated Citizens, 769 F.2d 511 (8th Cir. 1985). · cites it 2× “26 U.S.C. § 7408 (a). If the district court finds that the defend *515 ant has engaged in such conduct and that injunctive relief is appropriate to prevent its recurrence, then the court may enjoin the defendant from engaging in it or in any, other activity subject to penalty…”

United States v. Bell, 238 F. Supp. 2d 696 (M.D. Penn. 2003). · cites it 2× “The court notes that a preliminary injunction is also proper under 26 U.S.C. § 7408 . Section 7408 provides alternative grounds for the issuance of injunctive relief.”

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