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Insurance Law

Taxpayers decide to ignore the ACA insurance penalty

April 6, 2017
Woman showing fist in protest by Brooke Lark via Unsplash

Sometimes rules are only meaningful to the extent that they are enforced. In the case of the “shared responsibility” penalty of the American Care Act (ACA), a growing number of taxpayers are simply ignoring the penalty. In 2016, the ACA provided for a penalty of $695 or 2.5 percent if income for individuals who did not have insurance coverage for the full year. However, the ACA also limits…


Jewelry stores and micro-captive tax shelters

March 14, 2017
Diamond Photo: Wu Yi via Unsplash

A jewelry store taking out an insurance policy to protect against chemical terrorist attacks is pretty unusual. If that highly unusual insurance policy results in significant tax savings, then the federal government will probablyย have something to say. That is why theย Tax Court case, Avrahami v. Commissioner, may be a death-knell for the use of “micro-captive” insurance companiesย for tax avoidance purposes. Definitions Some definitions may be helpful: Captive: An…