| Tax Shelter
Disclosure Regulations. |
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These regulations were first
published 3/2/00
as temporary regulations requiring a corporate
taxpayer to make appropriate disclosure if it
engages in either: (i) a "listed transaction"
as defined; or (ii) a transaction that reduces
taxes by $10 million and that meets 2 of 6 other
criteria -- unless that transaction is in the
ordinary course of business. These regulations
were modified on 8/16/00,
on 8/7/01,
and on 6/18/02
to include non-corporate taxpayers. Revised temporary
regulations were published on 10/22/02,
effective 1/1/03, and expanded to require disclosure
if a transaction meets any one of six criteria.
Final regulations,
published and effective 2/28/03, basically follow
the revised temporary regulations published on
10/22/02. |
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| State Independently
Procured Premium Taxes |
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Dow Chemical Company, Appellant v. Carole Keeton Rylander, Comptroller of Public Accounts of the State of Texas; and John Cornyn, Attorney General of the State of Texas, Appellees |
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This
case again declared Texas' independently procured
premium tax unconstitutional. |
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370 US 451 State Board of Insurance v. Todd Shipyards Corporation |
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Landmark
U.S. Supreme Court case limiting a state's ability
to tax a foreign domiciled insurer. |
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ADDITIONAL BACKGROUND ON ALTERNATIVE RISK/ CAPTIVE INSURANCE PLANNING |
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Captive
Structuring |
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Humana, Inc. v. Commissioner 1 881 F.2d 247 (6th Cir. 1989) United States Court of Appeals for the Sixth Circuit Humana Inc., Petitioner-Appellant, v. Commissioner of Internal Revenue Respondent-Appellee |
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In this landmark case, the
Service lost its "economic family" argument. |
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Gulf Oil Corp. v. Commissioner 914 F.2d 396, 66 A.F.T.R.2d 90-5552, 90-2 USTC P 50,496 (3rd Cir. 1990) United States Court of Appeals, Third Circuit. |
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Amerco, Inc. v. Commissioner 979 F.2d 162 (9th Cir. 1992) United States Court of Appeals, Ninth Circuit. |
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Sears, Roebuck & Co. v. Commissioner 972 F.2d 858 (7th Cir. 1992) United States Court of Appeals, Seventh Circuit. |
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Ocean Drilling & Exploration Co. v. 988 F.2d 1135 (Fed.Cir. 1993) United States Court of Appeals, Federal Circuit. |
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Malone & Hyde, Inc. v. Commissioner 62 F.3d 835 (6th Cir. 1995) United States Court of Appeals, Sixth Circuit. |
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Allgeyer v. Louisiana. No. 446. Supreme Court of the United States. |
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Connecticut General Life Insurance Co. v. Johnson, Treasurer of California. No. 316. Supreme Court of the United States. |
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St. Louis Cotton Compress Company v. State of Arkansas. No. 120. Supreme Court of the United States. |
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Susan Combs, Comptroller of Public Accounts of the State of Texas, and Greg Abbott, Attorney General of the State of Texas, Appellants v.STP Nuclear Operating Company, Appellee |
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Kidde Industries, Inc. v. United States 40 Fed.Cl. 42 (Fed.Cl. 1997) |
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Holds that Humana case applies
to brother-sister subsidiaries and not divisions. |
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United Parcel Service of America, Inc. v. Commissioner of Internal Revenue, 254 F.3d 1014 (11th Cir. 06/20/2001) |
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In this significant
case, the taxpayer's tax motivation for forming
a captive was upheld in a $2 billion victory for
the taxpayer. |
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F. Income Tax Regulation 301.9100-1 |
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Relief under 301.9100-1 of the procedure and administrative regulations granting an extension of time to file election under 831 (b)2)(A)(ii). |
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U. TREAS. REG. Section 1.337(d)-4 abd Exempt Organizations |
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The IRS issued final regulations generally affecting a taxable corporation that transfers all or substantially all of its assets to a tax-exempt entity or converts from a taxable corporation to a tax-exempt entity in a transaction other than a liquidation. |
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Rev. Rul. 2001-31, 2001-26 I.R.B. 1348 (6/25/2001) |
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In this ruling, the IRS abandoned
the "economic family" doctrine which the Service
used to attack captive planning. |
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Cumulative Bulletin Notice 2001-51, I.R.B. 2001-34, August 2, 2001 |
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On February 28, 2000, the Internal Revenue Service issued Notice 2000-15 , 2000-12 I.R.B. 826, identifying certain transactions as "listed transactions" for purposes of §1.6011-4T(b)(2) of the temporary Income Tax Regulations and §301.6111-2T(b)(2) of the temporary Procedure and Administration Regulations. This notice restates the list of transactions identified in Notice 2000-15 as "listed transactions" effective February 28, 2000 , and updates the list by adding transactions identified in notices released subsequent to February 28, 2000. |
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Tax Shelter Prop - TD 9017 |
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Tax Shelter Props. Regs.- The IRS has published temporary regulations (T.D. 9017) that revise the categories of transactions that must be disclosed on returns under temporary reg. section 1.6011-4T. |
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Part III - Administrative, Procedural, and Miscellaneous Certain Reinsurance Arrangements Notice 2002-70 |
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In this November 2002 pronouncement,
the IRS announced that captive transactions utilizing
certain reinsurance arrangements (so-called "PORCs")
resulting in shifting of income will be "listed
transactions" for purposes of Reg. Sec. 1.6011-4. |
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Internal Revenue Bulletin: 2003-45 November 10, 2003 |
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In this publication, the IRS
announced that it will now consider ruling requests
on the tax treatment of captives. |
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IRS Revenue Ruling 2002-89 |
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In this ruling, the IRS determined
that where a captive derives 50% of its premiums
from underwriting its parent's risks (with the
other 50% of premium revenue from unrelated parties),
there was sufficient risk distribution to constitute
"insurance." |
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IRS
Revenue Ruling 2002-90 |
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In this pronouncement, the
IRS ruled that a captive which insured 12 subsidiaries
of a common parent, with no unrelated insurance
underwriting, had sufficient risk distribution
to constitute "insurance." |
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IRS
Revenue Ruling 2002-91 |
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In this ruling, the IRS determined
that if within a group captive no one member's
covered risks exceeded 15% of the group's total
risks, then that captive possessed sufficient
risk distribution to constitute "insurance." |
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Insurance Loophole
Helps Rich |
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Tiny Insurers Face Scrutiny As Tax Shields |
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Notice 2003-34 |
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Notice 2003-34 – Insurance definition – offshore entities in hedge funds. |
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Notice 2003-35 |
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Notice 2003-35- The purpose of this notice is to remind taxpayers that an entity must be an insurance company for federal income tax purposes in order to qualify as exempt from federal income tax as an organization described in 501 ( c ) (15). |
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Internal Revenue Service (I.R.S.) Revenue Ruling Insurance, Federal Income Tax Purposes |
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In this pronouncement,
the IRS discusses the qualifications of certain
arrangements as " insurance" for federal
income tax purposes and specifically addresses
the risk distribution requirement of a purported
insurance contract under four fact scenarios
listed in the ruling. |
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Notice 2005-49 Qualification of Certain Arrangements as Insurance |
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Notice 2005-49 comments on additional guidance concerning the standards for determining whether an arrangement constitutes insurance for federal income tax purposes. |
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Section 23. Small Insurance Companies or Associations IRC 501(c)(15) |
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IRS Manual on 501(c)(15) Insurance Companies. |
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Determination of Gross Receipts for Purposes of Section 501(c)(15) |
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Notice 2006-42 comments on The Determination of Gross Receipts for Purposes of Section 501(c)(15). |
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Relief under 301.9100-3 |
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Relief under 301.9100-3 of the Procedure and Administrative Regulations granting an extension of time to file under election under section 831(b)(2))(A)(ii).” |
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Rev. Rul 2007-47 was issued buy the US Internal Revenue Service on July 23, 2007 |
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This ruling holds that an arrangement that provides for the reimbursement of inevitable future costs does not involve the requisite insurance risk for purposes of determining (i) whether the amount paid for the arrangement is deductible as an insurance premium. |
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IRS Issued Proposed Regulations |
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IRS issued proposed regulations that provide guidance regarding the treatment of transactions involving obligations between members of a consolidated group and the treatment of transactions involving the provision of insurance between members of a consolidated group. |
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Internal Revenue Bulletin: 2008-5 February 4, 2008 Rev. Rul. 2008-8 |
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Revenue Rule 2008-8 explains how arrangements between an individual cell and its owner are analyzed for purposes of determining whether there is adequate risk shifting and risk distribution to constitute insurance. |
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TAM 200816029 on Partnership Entities Counted For Risk Distribution Purposes |
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TAM 200816029 on Partnership Entities Counted For Risk Distribution Purposes. |
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TAM 200827006 |
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TAM 200827006 - Ruling discusses whether a manufacturer’s original product warranty risks covered by the Reimbursement Policies purchased by Taxpayer constitute insurable risks for federal tax purposes. |
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THE FELDMAN LAw Firm
LLP
Galleria Tower II  Post Oak Tower
5051 Westheimer, Suite 1850
Houston, TX 77056-5604
713/850-0700 Fax: 713/850-8530
info@feldlaw.com |
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