Your 831(b) captive insurance program is under attack. You’ve seen it in the news. Read about it from your captive manager. Or, worse yet, heard from the I.R.S. that your captive insurance program is under audit. The I.R.S. is challenging hundreds of captive insurance programs. In Notice 2016-66, the I.R.S. fired the opening shot. Your recent Form 8886 disclosure is the next step. Expect the I.R.S. to initiate audits of numerous 831(b) captive insurance programs based upon the transaction of interest designation and the 8886 disclosure.
You did all the right things. You researched captive insurance. Hired an attorney or CPA to review the program. Spoke to references for your captive insurance manager. Purchased a feasibility study to analyze potential gaps in insurance coverage. You paid an actuary to determine appropriate pricing of policies. Now, the I.R.S. challenges your 831(b) captive insurance program.
Since 2013, our attorneys defended over 100 captive insurance cases against the I.R.S. This experience includes: being lead trial counsel in the U.S. Tax Court case of Caylor Land & Development v. Commissioner; defending a captive manager in an I.R.S. summons enforcement case in the U.S. District Court; representing a captive manager in a Freedom of Information Act case in the U.S. District Court; preparing and representing numerous clients in I.R.S. summons interviews; representing approximately 100 captive insurance cases during I.R.S. audits; and serving as trial counsel for cases in the U.S. Tax Court.
In our representation, we do not take a one-size fits all approach. Instead, we discuss your goals and objectives to determine the best approach in your specific case. The objectives of a current owner of an 831(b) captive insurance company differ from a retired businessman who sold his operating company and liquidated his 831(b) captive. We understand these differences.
We have the experience in 831(b) captive insurance cases to help you.