The government of Barbados has announced a number of legislative measures as it moves toward tax convergence of the country's international and domestic business sectors. Captive insurers will maintain zero taxation.
At the North Carolina captive insurance conference, Bruce Wright, a partner at Eversheds Sutherland (US) LLP, shared some insights surrounding Microsoft Corporation's Arizona captive insurance company (Cypress Insurance Company) payment of more than $875,000 for unpaid premium taxes and interest and penalties to the state of Washington.
A.M. Best said that the impact of tax reform is generally a positive for US-domiciled captives and a mixed bag for offshore captive insurance companies, though in some cases, it is a positive for offshore captives that have made the section 953(d) election under the Internal Revenue Code.
The Tax Court of New Jersey recently rendered an interesting decision regarding direct placement taxes. Eversheds Sutherland discusses Johnson & Johnson v. Director, Division of Taxation and Commissioner, Department of Banking and Insurance.
On June 18, 2018, the US Tax Court issued its opinion in Reserve Mechanical Corp. v. Commissioner, holding for the IRS. Eversheds Sutherland says that the facts of the case appear substantially similar to LTR 201609008, issued by the IRS in 2016.