Captive Insurance Tax Deductions Denied, No Risk Distribution

Insurance premiums go up and then they go up some more. The amounts can be substantial. This is particularly true for businesses that offer insurance to employees or that insure more types of risks. And many business owners note that while they pay substantial insurance premiums, the insurance companies often do not have high payouts.……

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Split-Dollar Insurance Failure: Income and No Tax Deduction

Business owners frequently seek ways to maximize tax deductions while providing benefits to key employees. Life insurance arrangements can play a part of this strategy. Life-insurance related strategies can be particularly useful if they come with significant tax advantages and help the parties meet their financial goals. However, the line between legitimate business expenses and……

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Business Advances in Revenue-Sharing Deals Not Deductible

Government agencies and non-profits often enter into business arrangements with private companies that, ultimately, are structured as a percentage of revenue. This approach frequently replaces traditional fixed payments like rent or management fees. The typical example involves a building that a business owns and leases to a government agency or non-profit. The business collects a……

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Probate Estate Can Serve as a Condit for Retirement Assets

When estate planning involves retirement accounts, most advisors recommend naming beneficiaries directly to avoid probate delays and preserve tax advantages. Surviving spouses typically receive the most favorable treatment under the tax code, with the ability to roll over inherited retirement assets into their own accounts and defer distributions based on their own life expectancy. However,……

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Can You Create Deductions by Forgiving Debt to Your Own Entities?

Business owners with multiple entities often transfer funds between their companies. These transfers are often accounted for in an inter-company account. In other instances, they may be structured as loans. When financial difficulties arise, these intercompany loans might be forgiven. If this is the case, can the borrowing entity exclude the forgiveness income while the……

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Can Limited Partners be Subject to Self-Employment Tax?

Investment funds are often structured as limited partnerships. These partnerships allow professional managers to pool investor funds while maintaining operational flexibility. These structures typically have a general partner (“GP”) who manages day-to-day operations. Limited partners (“LP”) provide the capital and earn passive returns. The active manager and passive investor roles have different tax implications. Self-employment……

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