As the Internal Revenue Service sees it, that line runs straight through some of the sophisticated investment vehicles created solely as tax benefits for high-net-worth individuals.

The IRS is taking aim at these taxpayers as well as the law firms, accounting firms and investment banks offering "abusive tax shelter" products -- such as "Cobra," "Opus" or "Blip" -- to well-heeled clients.

"These are not transactions that people enter into for long-term investment purposes," said Pam Olson, assistant Treasury secretary. "These schemes advertise a significant tax loss."

The IRS' challenge to Dallas-based legal giant Jenkens & Gilchrist last week threw a spotlight on the rarefied world of sheltering seven-figure -- and larger -- incomes from taxation.

IRS officials have demanded that Jenkens' Chicago office reveal the names of nearly 600 clients who might have used shelters to falsely claim at least $2.4 billion in deductions.

According to the government, the move was both routine and unprecedented.

Treasury officials described the summons to unmask those linked to questionable tax shelters as the first ever issued to a law firm.

The IRS said it was simply asking for adherence to the law requiring promoters of "potentially abusive tax-avoidance transactions" to share them with the agency.

Jenkens & Gilchrist said the release of the names would violate attorney-client privilege.

The IRS estimates that it loses $300 billion a year from fraudulent schemes, some of which benefit high-net-worth individuals. It has made the issue of abusive tax shelters a priority for two years.

Some experts say that such schemes gained momentum in the late 1990s, when executives and corporations were flush with profits and looking for ways to minimize their taxes.

What started as an examination of corporate tax papers is now focused on wealthy individuals. The IRS has published a list of 25 types of transactions that it considers abusive.

"The proliferation of these shelters on the corporate side has turned down," Ms. Olson said. "We have turned our attention to the high-net-worth individuals."

Experts say the tactics typically involve millions of dollars and are financially and legally complex. The shelters show taxpayers incurring massive losses through investments in multiple corporations, sometimes in different countries. But experts say this lengthy money trail makes it difficult to determine whether the loss-producing transactions were real or created just for tax purposes.

Other techniques might involve the use of financial derivatives, an investment vehicle whose value actually is determined by the value of an underlying security. Or the shelter might encompass arcane areas of the tax laws seldom seen, even by tax examiners. Or the shelter might use something else altogether.

Take Cobra, for instance. It's an acronym for "currency options bring reward alternatives." It employs international currency transactions to create losses that are in turn listed on the return to reduce the tax burden of an individual.

"The difference between a legitimate tax shelter and an abusive shelter is that the abusive shelter is artificially contrived and has no economic reality," said John Palter, a Dallas attorney who has sued accounting firms for clients who took tax advice to create illegal shelters.

Such schemes are light-years removed from the garden-variety fraud and fudging among some middle-income consumers. IRS officials routinely see taxpayers overstating the value of charitable deductions or claiming higher losses on stock transactions in the hope of a few thousand dollars in savings.

The shelters employed by high-net-worth individuals also come with a hefty price tag. They're typically sold by tax attorneys and accounting firms.

For example, four Indiana business people are suing Jenkens & Gilchrist in New York, saying they paid $2 million in fees to the law firm to get a tax shelter that the IRS does not approve.

The government's crackdown has yielded one informal measure of the marketplace: hundreds of boxes of promotional materials about the shelters, based on information from 1,600 taxpayers.

Legal issues aside, many lawyers and tax professionals say they have ethical concerns about the way some peers sell these shelters.

"I am not a shoe salesman or a used car salesman," said Steven Selch, a tax specialist and senior partner at Fulbright & Jaworski LLP in Houston. "I just don't see myself as someone who goes around the country telling clients, 'Boy have I got a deal for you!'"

-- Anuradha Raghunathan