While captive insurance companies have been used by large companies for over 60 years, their use by small and medium sized companies is still in its infancy. There are numerous reason for this, but perhaps the most important is the simple lack of knowledge.
While captive insurance companies have been used by large companies for over 60 years, their use by small and medium sized companies is still in its infancy. There are numerous reason for this, but perhaps the most important is the simple lack of knowledge.
While captive insurance companies have been used by large companies for over 60 years, their use by small and medium sized companies is still in its infancy. There are numerous reason for this, but perhaps the most important is the simple lack of knowledge.
While captive insurance companies have been used by large companies for over 60 years, their use by small and medium sized companies is still in its infancy. There are numerous reason for this, but perhaps the most important is the simple lack of knowledge.
While captive insurance companies have been used by large companies for over 60 years, their use by small and medium sized companies is still in its infancy. There are numerous reason for this, but perhaps the most important is the simple lack of knowledge.
While captive insurance companies have been used by large companies for over 60 years, their use by small and medium sized companies is still in its infancy. There are numerous reason for this, but perhaps the most important is the simple lack of knowledge.
While captive insurance companies have been used by large companies for over 60 years, their use by small and medium sized companies is still in its infancy. There are numerous reason for this, but perhaps the most important is the simple lack of knowledge.
In conjunction with the great people at TaxConnections, we’ve published a new eBook on captive insurance titled “Who Should Form a Captive Insurance Company?”. You can buy a copy HERE. Cost: $4.98.
To help potential captive owners determine if they should form a captive, I’ve written the “10 questions,” one of which is:
Am I able to actually negotiate the coverage terms with my current insurance carrier, or, do they hand me a policy to sign?
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Remember from a tax perspective, partners agree to share the economic benefits and burdens of ownership. This means that not only will they share profits, but they will also share losses and – in a worst case scenario — perhaps contribute additional capital in support of the business. For tax purposes, we need to create and maintain some record of this activity.
Enter the partner’s capital account. This is the most important element of partnership taxation; it is an ongoing record documenting the partner’s economic participation in the partnership. The actual workings of this account are one of the most complex in US taxation and therefore beyond the scope of a few blog posts. However, some initial observations can be made. Read More
The Bancroft case has been working its way through various federal jurisdictions over the last few years. In theory, it involves a captive insurance scenario. In reality, it’s tax evasion, plain and simple.
For me, the dead giveaway is the the “round trip” nature of the transaction. Consider this explanation of the program from the decision:
Sigel and Barros formed Bancroft. They didn’t know much about insurance so they outsourced the underwriting function, actuarial responsibility, claims handling, accounting function, due diligence inquiries, and routine paperwork chores. They also outsourced much of the investment operation. One of Bancroft’s primary investment vehicles was to make Read More
Yesterday we looked at dependent agents and their ability on the treaty to create a permanent establishment for an enterprise. Today I’ll be looking at independent agents, which do not lead to the determination of a permanent establishment for tax purposes and hence do not create a tax presence.
The commentaries provide this general definition to begin the discussion:
37. A person will come within the scope of paragraph 6, i.e. he will not constitute a permanent establishment of the enterprise on whose behalf he acts only if
a) he is independent of the enterprise both legally and economically, and Read More
TaxConnections Spotlight Interview Part 2: Chuck Levun And Michael Cohen On Partnership Tax Planning Challenges, And Surprising Cases And Mistakes They Have Seen
Biden’s Proposal On Largest Capital Gains Tax In Over A Century
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Retained Tax Executive Search Services: When You Need An Expert On A Tax Executive Search For Your Organization
Certificates Of Discharge From IRS Liens
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