Enterprise Risks + Estate Planning + Reduced Tax Liability = 831 (b) Captive
Brandt Beal
Chief Executive Officer
Risk, Estate Planning & Tax Strategies addressed by an 831(b) Micro Captive
Successful business owners are continuously exposed to complex risk and tax issues requiring strategic plans to adequately manage and mitigate the associated high costs. I know that I (and every other business owner I know) am continuously on the hunt for tax liability reduction strategies. We love Uncle Sam but want him in our pockets as little as possible. As a risk advisor by profession, I welcome the opportunity to transfer and finance enterprise type risks that are typically uninsurable in the traditional insurance marketplace. What if you could easily start insurance companies to insure these financially crippling risks like the loss of an operating license, restricting environmental regulations or bad publicity?
Well, you can and strategically reduce your tax liability at the same time. An 831(b) captive arrangement allows an individual or entity to form a micro captive and claim the IRS code 831(b) that waives tax liability on the first $1,200,000 of annual premiums. So, the business you own can insure typically uninsurable risks with tax deductible insurance premiums paid to a privately held insurance company that has zero tax liability on the first $1,200,000 in annual premium it collects.
It may sound too good to be true but an 831(b) captive insurance arrangement can do just that, creating profitable outcomes around tax, succession planning and advanced risk management. Download our whitepaper to learn more about 831(b) captive arrangements and how they may benefit you and your business.
