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
Copyright (C) 2014
ReplyDeleteROBIN S. WEINGAST & ASSOCIATES,
INC., ROBIN S. WEINGAST, DESIGNS
FOR FINANCE, INC., and CAPITAL
ONE, N.A. as successor to NORTH
FORK BANK AND TRUST CO., and
POINTE BENEFIT CONSULTANTS,
LLC.,
Defendants.
DENNIS M. CAVANAUGH, U.S.D.J.
This matter comes before the Court upon motions by Defendants Robin S. Weingast
&
Associates, Inc. and Robin S. Weingast (collectively the “Weingast Defendants”)
(ECF No. 24),
Defendant Designs for Finance, Inc. (“Designs”)(ECF No. 27), Defendant
Pointe Benefit
Consultants, LLC (“Pointe Benefit”)(ECF No. 29), and Defendant Capital One, N.A.
(“Capitol
One”)(ECF No. 31) to dismiss Plaintiffs Jeffrey Rapaport M.D., P.A. (“JRMDPA”),
Jeffrey
Rapaport (“Rapaport”), and Amanda Rapaport’s (collectively “Plaintiffs”) Complaint in
this action
pursuant to FED. R. CIV. P. 12(b)(6). Pursuant to FED. R. CIV. P. 78, no oral
argument was heard.
After considering the submissions of the parties, it is the decision of this Court for the
reasons herein
expressed that the motions to dismisssubmitted by Defendants Designs, Pointe
Benefit, and Capital
One are granted and the motion to dismiss by the Weingast Defendants is denied.
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Section 79 Plans
ReplyDelete412i, 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,Section 79 Audits,412i Problems,412i problems, Expert Witness Lance Wallach,412i Help,419 Help, Section 79 problem, Section 79 Life Insurance,
Wednesday, January 8, 2014
WHAT IS A SECTION 79 PLAN?
Section 79 plans are commonly known for the $50,000 free term life insurance they can provide for employees. Less commonly known is that Section 79 plans can also provide permanent life insurance. These plans are employee benefit plans established under Section 79 of the Internal Revenue Code. Section 79 plans are non-qualified plans but they are tax-deductible plans for the adopting employer.
WHAT ARE THE BENEFITS OF A SECTION 79 PLAN?
Section 79 plans provide life insurance benefits for employees paid for by the employer. The life premiums paid are 100% tax-deductible to the business. The "economic benefit" of the life insurance is reportable as taxable income for the insured employee. Only life insurance in excess of $50,000 is reportable. The "economic benefit" is determined using the rates under Table I ( Reg. §1.79-3(d)(2)). When permanent insurance is used the reportable economic benefit can be as little as 60% of the actual premium paid and deducted. This can provide a tax-advantaged way to purchase personal life insurance.
CAN ANY BUSINESS ADOPT A SECTION 79 PLAN?
Section 79 plans are only for employees. Self-employed individuals, partners and owners of S corporations are not employees. For an owner to participate the sponsoring employer must be a C Corporation.
MUST EVERY EMPLOYEE BE INCLUDED IN THE PLAN?
Non-discrimination rules do apply. 70% of all full time employees must benefit, or 85% of participants must be non-key employees. All participants must be offered the same type and amount of benefits. Special rules apply for companies with less than ten employees.
WHAT OPTIONS ARE TYPICALLY OFFERED IN A SECTION 79 PLAN THAT INCLUDES PERMANENT INSURANCE?
Typically, employees are offered three options. (1) Permanent life insurance with a death benefit that is a multiple of salary, (2) term insurance with a death benefit that is a multiple of salary, and (3) $50,000 group term insurance. The multiple of salary offered is usually defined by how much insurance the business owner wants for him or herself. Everyone will be offered the same multiple of salary. Option 1, permanent insurance, will produce the largest reportable economic benefit added to the taxable income of the employee, Option 2 will provide a significantly lower reportable economic benefit added to the taxable income of the employee, and Option 3 will result in no economic benefit added to the employee's taxable income.
These plans are sold so insurance agents can make commissions.
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Lance Wallach, co-author of several AICPA books with Sid Kess (’48), has completed his forth CPE book for Bisk CPEasy on business valuations. Wallach writes for over 20 financial publications and speaks frequently at national conventions. He is also an expert witness on abusive tax shelters.
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Lance wallach expert witness
Lance Wallach , our managing director, was named the National Society of Accountants Speaker of the Year and member of the AICPA faculty of teaching
professionals, is a frequent speaker on
retirement plans, financial and estate
planning, and abusive tax shelters. He writes
about 412(i), 419, and captive insurance
plans. He speaks at more than ten
conventions annually, writes for over fifty
publications, is quoted regularly in the press
and has been featured on television and radio
financial talk shows including NBC, National
Public Radio’s All Things Considered, and
others. Lance has written numerous books
including Protecting Clients from Fraud,
Incompetence and Scams published by John
Wiley and Sons, IRS Secrets You Should Know,
Bisk Education’s CPA’s Guide to Life Insurance and
Federal Estate and Gift Taxation, as well as AICPA best-selling books, including Avoiding Circular
230 Malpractice Traps and Common Abusive
Small Business Hot Spots. He does expert
witness testimony and has never lost a case.
Contact him at 516.938.5007,
wallachinc@gmail.com or visit www.
taxadvisorexperts.org or www.taxlibrary.us.
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Help with Common IRS Problems
ReplyDeleteLance Wallach, National Society of Accountants Speaker of the Year and member of the AICPA faculty of teaching professionals, is a frequent speaker on retirement plans, abusive tax shelters, financial, international tax, and estate planning. He writes about 412(i), 419, Section79, FBAR, and captive insurance plans. He speaks at more than ten conventions annually, writes for over fifty publications, is quoted regularly in the press and has been featured on television and radio financial talk shows including NBC, National Pubic Radio’s All Things Considered, and others. Lance has written numerous books including Protecting Clients from Fraud, Incompetence and Scams published by John Wiley and Sons, Bisk Education’s CPA’s Guide to Life Insurance and Federal Estate and Gift Taxation, as well as the AICPA best-selling books, including Avoiding Circular 230 Malpractice Traps and Common Abusive Small Business Hot Spots. He does expert witness testimony and has never lost a case.
Contact him at 516.938.5007, lawallach@aol.com or visit www.vebaplan.com.
Posted by Lance Wallach at 10:14 AM
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Labels: 412i, 419, 419A, 6707a, Benistar, form 8886, IRS, IRS Penalties, Lance Wallach Expert Witness, Section 79
Expert Witness Directory
ReplyDeleteCustomer Login
List Your Companye and Scams published by John Wiley and Sons, Bisk Education's CPA's Guide to Life Insurance and Federal Estate and Gift Taxation, as well as AICPA best-selling books, including Avoiding Circular 230 Malpractice Traps and Common Abusive Small Business Hot Spots. He does expert witness testimony and has never lost a case.
Copyright Lance Wallach, CLU, CHFC
More information about Lance Wallach, CLU, CHFC
While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.
419_412i Plan Plan Abuses
ReplyDelete412i, 419e plans litigation and IRS Audit Experts for abusive insurance based plans deemed reportable or listed transactions by the IRS.419 Plan, 412i Plan
Wednesday, August 13, 2014
IRS Clarifies Legality of 419(e) Plans
IRS Clarifies Legality of 419(e) Plans
Posted by Lance Wallach at 12:04 PM
Labels: 412, 412(i), 419 Plan, 419 Plans, 419 Planshelters
6 comments:
Lance WallachSeptember 29, 2014 at 11:05 AM
Copyright (C) 2014
ROBIN S. WEINGAST & ASSOCIATES,
INC., ROBIN S. WEINGAST, DESIGNS
FOR FINANCE, INC., and CAPITAL
ONE, N.A. as successor to NORTH
FORK BANK AND TRUST CO., and
POINTE BENEFIT CONSULTANTS,
LLC.,
Defendants.
DENNIS M. CAVANAUGH, U.S.D.J.
This matter comes before the Court upon motions by Defendants Robin S. Weingast
&
Associates, Inc. and Robin S. Weingast (collectively the “Weingast Defendants”)
(ECF No. 24),
Defendant Designs for Finance, Inc. (“Designs”)(ECF No. 27), Defendant
Pointe Benefit
Consultants, LLC (“Pointe Benefit”)(ECF No. 29), and Defendant Capital One, N.A.
(“Capitol
One”)(ECF No. 31) to dismiss Plaintiffs Jeffrey Rapaport M.D., P.A. (“JRMDPA”),
Jeffrey
419_412i Plan Plan Abuses
ReplyDelete412i, 419e plans litigation and IRS Audit Experts for abusive insurance based plans deemed reportable or listed transactions by the IRS.419 Plan, 412i Plan
Friday, August 8, 2014
ARTICLES,captive Insurance problems
ARTICLES,captive Insurance problems
Posted by Lance Wallach at 7:58 AM
Labels: Captive Insurance Plans, Captive Plan, Captives, Lance wallach, Lance Wallach Expert Witness
7 comments:
Lance WallachAugust 8, 2014 at 8:04 AM
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SECTION79ARTICLES
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79
PROBLEM
CPA Massachusetts Society Of Certified Public Accountants, Inc.
Winter 2010 IRS Attacks Business Owners in 419, 412, Section 79 and Captive Insurance Plans 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 you do not necessarily have to