Business Owners in 419, 412i, Section 79 and Captive Insurance Plans Will Probably Be Fined by the IRS Under Section 6707A
by Lance Wallach
Taxpayers who previously adopted 419, 412i, captive insurance or Section 79 plans are in big trouble. In recent years, the IRS has identified many of these arrangements as abusive devices to funnel tax deductible dollars to shareholders and classified these arrangements as “listed transactions.” These plans were sold by insurance agents, financial planners, accountants and attorneys seeking large life insurance commissions. In general, taxpayers who engage in a “listed transaction” must report such transaction to the IRS on Form 8886 every year that they “participate” in the transaction, and the taxpayer does not necessarily have to make a contribution or claim a tax deduction to be deemed to participate. Section 6707A of the Code imposes severe penalties ($200,000 for a business and $100,000 for an individual) for failure to file Form 8886 with respect t
Abusive Tax Shelters & 419 Plans Lawsuits
ReplyDelete412i, 419e plans litigation and IRS Audit Experts for abusive insurance based plans deemed reportable or listed transactions by the IRS.
Sunday, July 1, 2012
IRS to Audit Sea Nine VEBA Participating Employers
Lance Wallach
In recent months, I have received phone calls from participants in the Sea Nine VEBA and have learned that the IRS may be auditing many more participating employers in the coming months. To better assist current Sea Nine clients and those that are now or may be under audit in the future, my associates who are CPAs, tax attys and former IRS employees will continue to help with the Sea Nine VEBA victims and others in 419, 412i captive insurance and section 79 scams and answer the following:
• What is the IRS’s position with respect to the Sea Nine VEBA, 419 captive insurance and section 79 scams?
• What will be the likely result of my audit?
• What if I don't agree with my audit results?
• What are other participants doing with respect to the audits?
• Will the IRS impose interest and penalties?
• What is a “listed transaction”?
• What is Form 8886, and what are the penalties for failing to file Form 8886?
• Will I be responsible even if I relied on my tax advisor?