IRS Fires Warning Shot for Audits on Small Businesses Using Captive Insurance

Recent IRS rule changes have many small business owners wringing their hands.

“As a CPA and a lawyer, I’m always gleaning what I can from the IRS’ communications. They’re never going to come right out and tell you what they’re thinking, what specifically is going to flag your business for a review or audit.

But that changed when that organization in September put 831(b) based captive insurance companies squarely in the crosshairs, offering a sweeping back-taxes settlement deal to companies under audit for what the IRS deemed as “abusive” misuse of this tax-saving strategy.”

→ Here’s what small business owners need to know about continuing to utilize and benefit from a captive insurance strategy. Kiplinger