The federal Internal Revenue Service listed microcaptive insurance programs on its 2024 “Dirty Dozen” list of 12 tax scams, saying the programs can prove to be bogus tax avoidance strategies.
Tag: IRS
Micro-Captive Owners Must Understand Options as IRS Pressure Grows
As the Internal Revenue Service (IRS) moves forward with the process of drafting new laws for micro-captives, what happens next is a key concern for owners of tiny captive insurance firms or those considering forming them.
Once Scrutinized, Small Captives Become a Crisis Lifeline
A type of private insurance that is used by wealthy business owners to cover unlikely risks and that has been challenged by the Internal Revenue Service is proving to be beneficial as the coronavirus pandemic shuts down local economies. The structure, known as a small captive insurance, allows business owners to self-insure against unlikely but… Continue reading Once Scrutinized, Small Captives Become a Crisis Lifeline
IRS Announces Global Settlement of Abusive 831(b) Captive Insurance Tax Shelters
The IRS has announced a global settlement of cases involving abusive 831(b) captive insurance schemes. According to the announcement, “The settlement requires substantial concession of the income tax benefits claimed by the taxpayer together with appropriate penalties (unless the taxpayer can demonstrate good faith, reasonable reliance).” What this means is found in Attachment 1 to… Continue reading IRS Announces Global Settlement of Abusive 831(b) Captive Insurance Tax Shelters