IRS FAA: Captive Insurance Promoted Scheme Meets Tests Requiring Disclosure (IRC §831)

Promoted captive insurance transactions are the same as, or substantially similar to, the “[tax code] [S]ection 831(b) micro-captive transactions” identified as transactions of interest in Notice 2016-66, modified by Notice 2017-8, the Chief Counsel’s Office advised. The Chief Counsel’s Office analyzed the applicable law and guidance. The captive transactions were mostly redacted but the following information was provided to show tests were met: (1) the micro-captive transaction involves a person who directly or indirectly owned an interest in an entity (or entities) conducting a trade or business; (2) the captive was owned by the owners ...