Weathering the Storm: 18 Tips for Assessing Your Client's Section 831(b) Micro-Captive Insurance Planning Following the Avrahami Decision... [ read ]
The Tax Court's decision in Avrahami v. Commissioner created a storm that is brewing in the I.R.C. Section 831(b) micro-captive insurance industry. Some microcaptives are a safe distance away from the storm's path. Others are at risk for an indirect hit. Still others are likely facing the very eye of the storm. The key is preparation, and this requires an objective assessment. We must know where the captive insurance planning sits on the storm's projected path so we can help our clients make the planning storm-ready. As we begin to look more closely at our clients' captive insurance planning in light of Avrahami, we should be mindful of the following warning signs:
"Qualifying" Your Settlement Offer: How to Get the IRS to Think Twice Before Rejecting a Fair Offer... [ read ]
With funding and staffing low, and caseloads high, you would expect the IRS to be more attentive in its efforts to resolve cases. But in my experience the opposite holds true, with IRS personnel seemingly more interested in moving a case to someone else's desk rather than out the door. So how do you get the IRS to seriously consider an otherwise fair settlement offer? Make it a qualified offer.
Options for Taxpayers With Unfiled Tax Returns... [ read ]
Whether due to oversight or intentional conduct, there are number of individuals and businesses with unfiled federal tax returns. Under the Internal Revenue Code (IRC) the failure to file a tax return is a misdemeanor (IRC Section 7203) punishable by imprisonment of not more than one year and a fine of up to $25,000.
Treasury and IRS to Withdraw Controversial 2704 Proposed Regulations... [ read ]
The long, tumultuous road of the proposed regulations under I.R.C. Section 2704 (the "2704 Proposed Regulations") should be coming to an end with Treasury's recent report in response to Executive Order 13789.
TIGTA Report on IRS Estate and Gift Tax Examinations... [ read ]
On September 28th, the Treasury Inspector General of Tax Administration (TIGTA) issued a report recommending changes to fix the procedures the IRS uses to select estate and gift tax returns for examination.
IRS Extends Hurricane Tax Relief to Dallas and Tarrant Counties... [ read ]
Hurricane Harvey tax relief has been extended to taxpayers residing in Dallas and Tarrant counties.
Do Hurricane Harvey Victims Have Additional Time to File FBARs (Form 114)?... [ read ]
I recently explored in a separate Blog post whether partners that live outside the disaster area qualify for additional time to make tax payments and file returns if the partnerships are located inside the disaster area. A similarly burning question is whether hurricane victims have additional time to file FBARs (Form 114), the filing obligation for which arises under Title 31 rather than Title 26 of the United States Code and which have an extended due date of October 15, 2017. The proverbial jury was out on this issue until today, when FinCEN delivered a verdict.
Do Partners Who Reside Outside a Disaster Area Qualify for Tax Relief if the Partnership's Business is Located Inside the Disaster Area?... [ read ]
When disaster strikes, the IRS may permit taxpayers additional time to make tax payments and file returns provided they qualify as "affected" taxpayers in counties that have been designated as federal disaster areas. IRC Sec. 7805A. While it is clear that partnerships with a principal place of business inside the disaster area qualify as affected taxpayers, what about the partners of those partnerships who live outside the disaster area? Do they qualify for tax relief? As is often the answer in the tax world, it depends.
New IRS Ruling Reveals that Not All Captives are Bad... [ read ]
On August 21, 2017, the Tax Court handed the IRS a critical victory in the first ever case deciding an IRS challenge to an IRC section 831(b) microcaptive insurance arrangement. This decision follows an over three year enforcement push by the IRS against the small captive insurance industry, an initiative that ensnarled captive managers and taxpayers alike as well as landed microcaptives on the IRS' dirty dozen lists. But a ruling issued just days before that decision reveals that the IRS is not seeking to disavow all captive insurance arrangements – perhaps just cull out some of the bad apples.
In the First Case Ever Decided Involving IRC Section 831(b) Microcaptive Insurance Planning, the Tax Court Delivers the IRS a Critical First Win... [ read ]
On August 21, 2017, the Tax Court handed the IRS a critical victory in the first ever case deciding an IRS challenge to an IRC section 831(b) microcaptive insurance arrangement. This decision follows an over three year enforcement push by the IRS against the small captive insurance industry, an initiative that ensnarled captive managers and taxpayers alike as well as landed microcaptives on the IRS' dirty dozen lists. But a ruling issued just days before that decision reveals that the IRS is not seeking to disavow all captive insurance arrangements – perhaps just cull out some of the bad apples.
