Description: In March 2010, Congress codified the judicial economic substance doctrine in an effort to raise revenue as part of the health care reform legislation.1 The law provides for strict liability penalties of 20 percent for understated taxes and refund claims that result from transactions that lack economic substance. In July 2011, the commissioner of the Large Businessand International Division LB&I of the IRS evidently recognized this state of uncertainty and issued very helpful guidance to all LB&I examiners to fill the void on guidance for economic substance..

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: This article addresses changes to the IRS Appeals Conference.

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.

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

Description: This article Provides a description of an IRS Directive that provides a safe harbor tax reporting position for computing tax reserves for pre-2018 tax years for annuity contracts subject to AG43 and VM-21 and life insurance contracts subject to VM-20 Principal Based Reserves methods. The safe harbor is required to be implemented on the 2017 tax return, with certain spread amounts in some cases to future tax years starting in 2018.

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: This article presents a high-level overview of the Federal Income tax rules in section 382 regarding limitations on the use of losses after an ownership change takes place and summarizes problems and issues for the insurance industry in proposed regulations under section 382 as summarized in comments made by the industry and the ACLI

Description: The article summarizes and comments on a recent IRS Chief Counsel Advice that addressed how the proration formula works for purposes of the separate account dividends received deduction in the context of a partnership structure. The article explains the historical background of the proration formula as it appeared in the 1959 Act and the differences between how the applies and affects the dividends received deduction in the partnership structure versus the more tradition RIC structure.