Lance Wallach
Prognostications on Captives
Grounds for IRS challenges
Given the substantial tax benefits associated with a captive
insurance company, it is not
Surprising that the IRS has challenged certain aspects of
Captives over the years. The primary
arguments for those challenges are:
(1) The Captive is not writing "insurance" in the
usual sense, due to a lack of risk shifting
and risk distribution.
(2) Excessive premiums are being paid.
Consequently, it is critical that a Captive not only be
formed and administered correctly, but also
that it issue true insurance to its affiliates.
Lance Wallach, CLU, ChFC, CIMC, speaks and writes extensively
about financial planning, retirement plans, and tax reduction strategies. He is an American Institute of CPA’s course
developer and instructor and has authored numerous bestselling books about
abusive tax shelters, IRS crackdowns and attacks and other tax matters. He
speaks at more than 20 national conventions annually and writes for more than
50 national publications. For more
information and additional articles on these subjects, visit www.vebaplan.com,
www.taxlibrary.us, lawyer4audits.com or call 516-938-5007.
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