A form of fraudulent tax evasion in which a firm intentionally attempts to conceal its true taxes by following deceptive accounting practices such as overvaluing depreciating assets and using faulty methods to recognize certain types of income.

At times, abusive tax shelter takes the form of an investment that a firm uses to avoid taxes in a law-violating manner, such as limited partnership. Such a firm usually claims illegal tax deductions, by exaggerating the value of an asset beyond its fair market value.