The IRS recently offered settlements to a select number of taxpayers involved in what are known as “micro-captive” insurance schemes. Tax law generally allows businesses to create “captive” insurance companies to protect against certain risks.
In abusive “micro-captive” structures, accountants or wealth planners con- vince owners of closely held entities to engage in schemes that actually lack the protections of real insurance.
Under IRS Notice 2016-66, taxpayers are mandated to disclose such trans- actions due to their potential for tax evasion. Almost 80 percent of taxpay- ers offered the settlement accepted the offer.
The offers were made after the IRS won three cases in U.S. Tax Court cases fighting such schemes.
Micro-captive schemes have been a major priority for IRS enforcement since 2014, and several active cases remain. Some will likely be settled and others will go to trial. The IRS plans to ramp up enforcement with teams auditing thousands of taxpayers.
The Sensible Taxation and Equity Promotion (STEP) Act would get rid of what’s known as the step-up in basis to tax the unrealized gains of certain estates at death.
Step-up in basis refers to the way the value of an asset is readjusted for tax purposes upon inheritance.
Telecommuting is the new normal for many employers who never would have considered such an arrangement in the past.
Employers with out-of-state remote workers should consult with a lawyer to discuss associated legal risks and develop policies to address them
The Setting Every Community Up for Retirement Enhancement (SECURE) Act, which passed in late 2019, was only the start of changes for the retirement industry. A bipartisan bill, which has been nicknamed “SECURE Act 2.0,” is in the works.
A new federal law targets wealthy buyers who purchase high-priced homes and commercial properties through anonymous shell companies. The law is designed to combat money laundering and stop the flow of illicit money into U.S. real estate.
For people who want to work while collecting Social Security, the “retirement earnings test” (RET) rules can be confusing. Some people think they’ll lose out on benefits if they continue to work, but that’s not true.
If you are in a committed relationship but are not married to your partner, estate planning is essential. Unless you each draft a will and designate the other person as a beneficiary, your assets will pass to other family members and your partner will receive nothing when you die. Further, without proper planning you won’t