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Articles

REVISITING RISK DISTRIBUTION

Captive Review

  • Published On: September 30, 2010

Risk distribution, a defining characteristic of an insurance company, continues to be a topic of US tax controversy for captives. Still today, a quarter of a century after the controversy took root, controversy lingers because risk distribution has not been defined in a consistent way by the courts and the Internal Revenue Service (IRS). What has been absent from both IRS and judicial guidance is the context of why risk distribution is a defining characteristic of an insurance company.

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