412i, 419e plans litigation and IRS Audit Experts for abusive insurance based plans deemed reportable or listed transactions by the IRS.
412i, 419e plans litigation and IRS Audit Experts for abusive insurance based plans deemed reportable or listed transactions by the IRS.
The IRS has sought penalties against individuals and companies of up to $200,000 per year for participating in bogus welfare benefit plans. Many companies attempted to obtain favorable tax treatment by creating plans that were set up pursuant to IRS Code section 419 (Section 419A(f)6 and Section 419(e)). Ultimately, the IRS has determined that abusive welfare benefit plans are “listed transactions” which require the participant in the plan to fill out a special IRS form, Form 8886, disclosing participation in a listed transaction. While not every plan is illegal, the IRS requires that you disclose your investment in the plan. If you fail to disclose your participation in a plan the penalties can be significant and even more for companies. If you or your company received a notice from the IRS about penalties and interest regarding your participation in a 419 Plan contact us to discuss your options. Such plans were sold as 419(e), 419A(f)(6) and 419 plans.
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