Tax shelters are legal methods used by individuals or businesses to reduce their taxable income and minimize the amount of taxes owed.

Tax shelters can take many forms, including investments in real estate, limited partnerships, oil and gas partnerships, and other types of ventures that offer tax benefits. In some cases, tax shelters may be used to defer taxes to a future date or to shift income to a lower tax bracket.

While some tax shelters are legitimate and encouraged by the tax code, others may be considered abusive or illegal, such as offshore tax shelters or fraudulent schemes. The use of tax shelters is a complex area of tax law and requires careful consideration and planning to ensure compliance with tax laws and regulations.