Reportable Transactions and 419 Plans Litigation - Welfare benefit, Medical, Retirement plan benefit and design, Pension specialists, 412i Lawsuits, 419 lawsuits, IRS Audits, 412i Problems, Expert Witness Lance Wallach
Reportable Transactions and 419 Plans Litigation - Welfare benefit, Medical, Retirement plan benefit and design, Pension specialists, 412i Lawsuits, 419 lawsuits, IRS Audits, 412i Problems, Expert Witness Lance Wallach
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419 412i captive insurance section 79 scams for help www.taxaudit419.com
NSA MEMBER LINK January 23, 2008
WELFARE BENEFIT 419 INSURANCE PLANS NAMED LISTED TRANSACTIONS
Lance Wallach
During tax season, many accountants will unknowingly allow clients to deduct listed transactions or potentially abusive tax shelters. Under existing and new regulations both the taxpayer and the accountant can be held accountable. For example, in February 2007 alone, we received over one thousand phone calls asking about 419, 412(i) and other potentially abusive plans.
The IRS has named most 419 welfare benefit insurance plans as listed transactions. Previously the IRS had named 419A (f)(6) plans as listed transactions. Taxpayers participating in these listed transactions must disclose such participation to the IRS. In addition, material advisors must also disclose their involvement. This involvement might include allowing the deduction of the plan on the client’s tax return. The penalty for nondisclosure can be $200,000.
Most accountants are not aware of these plans, which are sold by many insurance agents and financial planners. I have received hundreds of phone calls after the IRS has disallowed plans on audit. The IRS is now making the accountants policemen for these and other abusive plans that their clients may be participating in.
When I speak at accounting conventions about abusive plans, most accountants are not aware of what I am talking about, and do not think that their clients would be involved in these types of plans. Unfortunately once they find out that their clients have contributed to these plans much of the damage has been done.
On Oct.17, 2007, the IRS, in Notice 2007-83, identified as listed transactions certain trust arrangements involving cash-value life insurance. Also simultaneously issued was Notice 2007-84, which disallows tax deductions and imposed severe penalties for welfare benefit plans that discriminate.
Many of these plans have already or will, go out of business. At least two of these plans have stolen the participant’s money.
An accountant who has a client in one of these plans, or who is approached by a client about one of these plans should be cautious, both for the client and for himself.
For more articles on the subject visit, www.vebaplan.com
Lance Wallach speaks and writes extensively about retirement plans, estate planning, and tax reduction strategies. He speaks at more than 70 conventions annually, writes for over 50 publications, and was the National Society of Accountants Speaker of the Year. Contact him at 516.938.5007 or visit www.vebaplan.com.
The information provided herein is not intended as legal, accounting, financial or any other type of advice for any specific individual or other entity. You should contact an appropriate professional for any such advice.
www.lancewallach.com
section 79 help sea nine veba audits www.vebaplan.com
Similarly, the IRS position on single employer welfare benefit plans invested in permanent life insurance where the employer deducts more than the term cost of insurance is that those plans are also abusive tax scams.
• Millennium Plan
• Insured Security Plan
• Corporate Benefit Services Plan
• Sea Nine Associates VEBA
• Niche National Benefit Plans
• Professional Benefit Trust (PBT)
• Koresko STEP Plan
• Bisys Plan
• Xelan Plan
• Sterling Plan
Question: What is the IRS position on these plans?
Answer: The IRS position appears to be that all multiple employer welfare benefit plans funded with permanent life insurance are abusive tax scams. Their history is to open promoter audits on every such plan and eventually to obtain the client lists from the promoters and then audit their clients. The IRS position on single employer welfare benefit plans that are spin-offs of the multiple employer plans appears to be the same.
Question: Has the IRS approved any multiple or single employer welfare benefit plan invested in permanent life insurance?
Answer: Though an IRS private letter ruling is not immediately public, it is my understanding that the IRS has never “approved” of any multiple or single employe
section 79 help sea nine veba audits www.vebaplan.com
Similarly, the IRS position on single employer welfare benefit plans invested in permanent life insurance where the employer deducts more than the term cost of insurance is that those plans are also abusive tax scams.
• Millennium Plan
• Insured Security Plan
• Corporate Benefit Services Plan
• Sea Nine Associates VEBA
• Niche National Benefit Plans
• Professional Benefit Trust (PBT)
• Koresko STEP Plan
• Bisys Plan
• Xelan Plan
• Sterling Plan
Question: What is the IRS position on these plans?
Answer: The IRS position appears to be that all multiple employer welfare benefit plans funded with permanent life insurance are abusive tax scams. Their history is to open promoter audits on every such plan and eventually to obtain the client lists from the promoters and then audit their clients. The IRS position on single employer welfare benefit plans that are spin-offs of the multiple employer plans appears to be the same.
Question: Has the IRS approved any multiple or single employer welfare benefit plan invested in permanent life insurance?
Answer: Though an IRS private letter ruling is not immediately public, it is my understanding that the IRS has never “approved” of any multiple or single employe
ance Wallach said...
section 79 help sea nine veba audits www.vebaplan.com
Similarly, the IRS position on single employer welfare benefit plans invested in permanent life insurance where the employer deducts more than the term cost of insurance is that those plans are also abusive tax scams.
• Millennium Plan
• Insured Security Plan
• Corporate Benefit Services Plan
• Sea Nine Associates VEBA
• Niche National Benefit Plans
• Professional Benefit Trust (PBT)
• Koresko STEP Plan
• Bisys Plan
• Xelan Plan
• Sterling Plan
Question: What is the IRS position on these plans?
Answer: The IRS position appears to be that all multiple employer welfare benefit plans funded with permanent life insurance are abusive tax scams. Their history is to open promoter audits on every such plan and eventually to obtain the client lists from the promoters and then audit their clients. The IRS position on single employer welfare benefit plans that are spin-offs of the multiple employer plans appears to be the same.
Question: Has the IRS approved any multiple or single employer welfare benefit plan invested in permanent life insurance?
Answer: Though an IRS private letter ruling is not immediately public, it is my understanding that the IRS has never “approved” of any multiple or single employe
February 3, 2014 at 1:33 PM Delete
Blogger Lance Wallach said...
section 79 help sea nine veba audits www.vebaplan.com
Similarly, the IRS position on single employer welfare benefit plans invested in permanent life insurance where the employer deducts more than the term cost of insurance is that those plans are also abusive tax scams.
• Millennium Plan
• Insured Security Plan
• Corporate Benefit Services Plan
• Sea Nine Associates VEBA
• Niche National Benefit Plans
• Professional Benefit Trust (PBT)
• Koresko STEP Plan
• Bisys Plan
• Xelan Plan
• Sterling Plan
Question: What is the IRS position on these plans?
Answer: The IRS position appears to be that all multiple employer welfare benefit plans funded with permanent life insurance are abusive tax scams. Their history is to open promoter audits on every such plan and eventually to obtain the client lists from the promoters and then audit their clients. The IRS position on single employer welfare benefit plans that are spin-offs of the multiple employer plans appears to be the same.
Question: Has the IRS approved any multiple or single employer welfare benefit plan invested in permanent life insurance?
Answer: Though an IRS private letter ruling is not immediately public, it is my understanding that the IRS has never “approved” of any multiple or single employe
Listed Transactions & 419 Plans Litigation
412i, 419e plans litigation and IRS Audit Experts for abusive insurance based plans deemed reportable or listed transactions by the IRS.412i, 419e plans litigation and IRS Audit Experts for abusive insurance based plans deemed reportable or listed transactions by the IRS.Benistar,412i Lawsuits,419 lawsuits,412i Help,419 Help, IRS Audits,412i Problems,412i problems, Expert Witness Lance Wallach,412i Help,419 Help, Benistar Lawsuits, 412i lawsuits,419 lawsuits,
Wednesday, August 22, 2012
Have You Dealt With Any Of These People?
Kenny Hartstein Dennis Cunning Steve Toth
Larry Bell Scott Ridge Randall Smith
Greg Roper Tracy Sunderlage Joseph Donnelly
Norm Bevan Michael Sonnenberg Judy Carsrud
Michael Carroll Anthony Fakouri
Steve Burgess Tom Crosswhite
Than You Should Know:
The dangers of being "listed"A warning for 419, 412i, Sec.79 and captive insurance
As published in:AccountingToday: October 25, 2010By: 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 you do not necessarily have to make a contribution or claim a tax
deduction 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 to a listed transaction.
But you are also in trouble if you file incorrectly.
I have received numerous phone calls from business owners who filed and still got fined. Not only do you have to file Form 8886,
but it has to be prepared correctly. I only know of two people in the United States who have filed these forms properly for clients.
They tell me that was after hundreds of hours of research and over fifty phones calls to various IRS
personnel.
The filing instructions for Form 8886 presume a timely filing. Most people file late and follow the directions for
n 79 Plans
412i, 419e plans litigation and IRS Audit Experts for abusive insurance reportable or listed transactions by the IRS,Section 79, Section 79 Lawsuits,412i, 419e plans litigation and IRS Audit Experts for abusive insurance based plans deemed reportable or listed transactions by the IRS.Benistar,412i Lawsuits,419 lawsuits,412i Help,419 Help, IRS Audits,412i Problems,412i problems, Expert Witness Lance Wallach,412i Help,419 Help, Benistar Lawsuits, 412i lawsuits,419 lawsuits,
Thursday, July 5, 2012
Internal Revenue Code 6707A and Section 79: Breaking Down the Problem
Internal Revenue Code 6707A and Section 79: Breaking Down the Problem
Lance Wallach Council Member President, VEBA Plan
April 06,
Premise
by Lance WallachThe IRS is fussy about its forms, and people involved in 419 and 412i plans discovered that the hard way. Now the IRS is starting to target Section 79 plans, and business owners are running into the same 6707A issues that the 412i and 419 plan participants had. Knowing this history could help someone considering a Section 79 plan avoid those very major headaches.
Discussion
Insurance companies, agents, financial planners, and others have pushed abusive 419 and 412i plans for years. They claimed business owners could obtain large tax deductions. Insurance companies, agents and others earned very large life insurance commissions in the process. Eventually, the IRS cracked down on the unsuspecting business owners. Not only did they lose the tax deductions, but they were also fined and charged penalties and interest.
After the business owner was assessed the fines and lost his tax deduction, the IRS then came back and fined him a huge amount of money for not telling on himself under Internal Revenue Code 6707A. You see, if you participate in a listed or reportable transaction, you must alert the IRS or face a large fine
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