Description: We frequently are asked what to do when a company has reported aggregate estimates of tax reserves on the tax return, instead of tax reserves computed precisely according to the requirements of the Internal Revenue Code, and the IRS has challenged the reserve deduction. Other sections of this article also cover IRS rulings on the treatment and valuation of an insurance company stock purchased as an asset acquisition and COLI life insurance.

Description: A discussion about foreign currency hedging, foreign insurance excise tax, taxation of credit default swaps and bad debts.

Description: Section 807d of the IRC provides that the deductible reserve for a life insurance contract is the greater of net surrender value or the Federally Prescribed Reserve FPR calculated under prescribed interest rate and mortality assumptions, but in no event can the tax reserve exceed “aggregate statutory reserves” i.e., the statutory cap. This article logically concludes that deficiency reserves are included in the calculation of the statutory cap.

Description: Discusses the meaning of statutory reserves with respect to a pending IRS ruling, in the case where different levels of statutory reserves are required in different states.

Description: Discusses five subjects, including proposed IASB discussion paper, split-dollar life insurance, penalties for paid tax preparers, statutory reserves for insurers, and NAIC securitization initiatives.

Description: A discussion of: IRS requirement disclosures of uncertain tax positions, disallowed interest reductions on earnings and profits, and tax standards for partial worthlessness deductions.

Description: Two relatively recent developments have heightened tax managers’ anxiety concerning the possible disclosure of tax accrual workpapers.

Description: Comparison of statutory and tax accounting rules in treatment of non-performing assets.