S.C. Joins CFCI Against IRS Captive Tax Plan

The South Carolina Department of Insurance announced it has joined the Coalition for Fairness to Captive Insurers (CFCI) to help stop a proposed regulation by the Internal Revenue Service it says could harm the captive industry.

The proposal change announced on Sept. 28 would reverse a long-standing tax treatment of captive insurers and put them on the same footing as self-insureds. Unlike insurers, self-insureds are unable to deduct a discounted reserve for estimated losses and expenses, whether or not claims have been filed.