On April 10, 2023, the Internal Revenue Service (IRS) issued proposed regulations addressing micro-captive insurance transactions that must be reported as either a listed transaction or other transaction of interest. The IRS previously issued guidance on this topic (Notice 2016-66), which a Tennessee federal district court recently invalidated.
The US Treasury Department and the Internal Revenue Service (IRS) have issued proposed regulations identifying certain micro-captive transactions as "listed transactions" and certain other micro-captive transactions as "transactions of interest." The move comes days after the IRS released its 2023 Dirty Dozen list, which included abusive micro-captive transactions.
The Internal Revenue Service (IRS) has released its 2023 Dirty Dozen list, and once again, micro-captives and Puerto Rican and foreign captive insurance are included on the list. The IRS said the list is meant to alert taxpayers, businesses, and tax professionals of potentially abusive tax arrangements and scams.
The US Internal Revenue Service (IRS) has added abusive micro-captive arrangements to the final version of its 2022 "Dirty Dozen" list of potentially abusive tax schemes. Earlier in June, the IRS had included foreign captive insurance arrangements on the first installment of entrants on this year's Dirty Dozen list.
Foreign captive insurance transactions found a place on the Internal Revenue Service's 2022 "Dirty Dozen" list of potentially abusive tax arrangements. The IRS said the four arrangements on the first group on its 2022 list "will likely attract additional agency compliance efforts in the future."