A Bloomberg BNA alert reports that the IRS will back off of its prior practice of challenging brother-sister captive insurance arrangements as a result of the U.S. Tax Court's decisions in Rent-A-Center, Inc. v. Comm'r, 142 T.C. 1 (2014) and Securitas Holdings, Inc. v. Comm'r. The alert reports that the IRS will, however, continue to take an aggressive stance toward "micro" captives.
The U.S. Tax Court upheld Rent-A-Center's brother-sister captive insurance arrangement, overruling a nearly 30-year-old precedent. The IRS did not appeal the Tax Court's decisions in Rent-A-Center or in Securitas.
Rent-A-Center was represented in this landmark case by Gardere Tax Attorneys Val J. Albright and Brent C. Gardner.
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