This is Part 1 of a series on the recent Avrahami decision.
By Sean King, JD, CPA, MAcc
Last week the United States Tax court issued the long-awaited opinion in the Avrahami captive insurance case. And after more than 30 years of losing most every captive insurance case of consequence, the IRS finally got a win.
The Avrahami case involved a small, foreign-domiciled captive insurance company (“CIC”) that had made both the 953(d) election (to be taxed as a US entity) and the 831(b) election (giving it favorable US tax treatment on its underwriting profits). The CIC in question Continue Reading