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Lance Wallach in The Press
Is 2010 the Year of Avoiding Taxes?
In a speech last May, President Obama said, "Nobody likes paying taxes . . . . And yet, even as most
American citizens and businesses meet these responsibilities, there are others who are shirking theirs."
He was referring to offshore tax havens and other loopholes that wealthy Americans often exploit to
reduce their tax burden. But it doesn't take moving money to Switzerland to avoid paying taxes. If
history is any guide, 2010 will be a year in which many Americans use a few simple methods to
reduce their tax liability, which could potentially cost the government billions of dollars. This year is
the last before the expiration of tax cuts originally put in place by the Bush administration. If
Congress allows these tax cuts to expire, as the president supports, in 2011 the top marginal tax rates
will increase from 28, 33, and 35 percent to Read more here
Detroit Free Press
$10B aimed at union retirees: Provision called welfare by some, not enough by
WASHINGTON -- Ant labor forces say it's welfare for the UAW and Democrats' union allies. Labor
supporters say it falls short of what's needed as tens of thousands of union members are pushed into
early retirement as employers cut back health care coverage.
They're both talking about a $10-billion provision tucked deep inside thousands of pages of health
care overhaul bills that could help the UAW's retiree health-care plan and other union-backed plans.
It would see the government -- at least temporarily -- pay 80 cents on the dollar to corporate and
union insurance plans for claims between $15,000 and $90,000 for retirees age 55 to 64.
Big businesses with union workers are twice as likely to offer retiree benefits as nonunion ones. Read
Without Aid, Union Health Plans Face Failure
WASHINGTON – The health care debate roiling the nation promises an even greater impact in Michigan: It could
determine whether the UAW’s gamble that it can insure 850,000 retirees from Detroit’s automakers pays off or goes
Thanks to Detroit’s twin auto bankruptcies and other concessions, the UAW’s voluntary employee benefit association,
or VEBA, had to take stock of unknown value for $24 billion in claims, while adding thousands of early retirees to its
Outside experts estimate the funds have about 30 cents in cash for every dollar of future claims, with no guarantee of
what its stock assets will be worth. Lance Wallach, a New York-based VEBA expert, said if the funds “don’t get
something, they’re out of business in 12 years.”
That something may be national health care reform.
Key provisions in House and Senate proposals set aside $10 billion to pay some claims for early retirees covered by
employers and VEBAs, before other cost-saving measures kick in. Critics call it a union giveaway, but the union says
the money would keep companies from further slashing coverage. Read more here
NCCPAP November 2010 Newsletter 2010
Business Owners in 419, 412i, Section 79 and Captive Insurance Plans Will Probably
Be Fined by the IRS Under Section 6707A
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 the taxpayer does not necessarily have to make a contribution or claim a tax deduction to be deemed 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 a taxpayer can also be in trouble if they
file incorrectly. I have received numerous phone calls from business owners who filed and still got fined. Not only does
the taxpayer 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 told me that the form was prepared 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 currently preparing the forms. Then the IRS fines the
business owner. The tax court does not have
jurisdiction to abate or lower such penalties imposed by the IRS.
Many business owners adopted 412i, 419, captive insurance and Section 79 plans based upon representations provided
by insurance professionals that the plans were legitimate plans and
they were not informed that they were engaging in a listed transaction. Upon audit, these taxpayers were shocked when
the IRS asserted penalties under Section 6707A of the Code in the hundreds
of thousands of dollars. Numerous complaints from these taxpayers caused Congress to impose a moratorium on
assessment of Section 6707A penalties.
The moratorium on IRS fines expired on June 1, 2010. The IRS immediately started sending out notices proposing the
imposition of Section 6707A penalties along with requests for lengthy extensions of the Statute of Limitations for the
purpose of assessing tax. Many of these taxpayers stopped taking deductions for contributions to these plans years
ago, and are confused and upset by the IRS’s inquiry, especially when the taxpayer had previously reached a monetary
settlement with the IRS regarding the deductions
taken in prior years. Logic and common sense dictate that a penalty should not apply if the taxpayer no longer benefits
from the arrangement.
Treas. Reg. Sec. 1.6011-4(c)(3)(i) provides that a taxpayer has participated in a listed transaction if the taxpayer’s tax
return reflects tax consequences or a tax strategy described in the published guidance identifying the transaction as a
listed transaction or a transaction that is the same or substantially
similar to a listed transaction. Clearly, the primary benefit in the participation of these plans is the large tax deduction
generated by such participation. It follows that taxpayers who no longer enjoy the benefit of those large deductions are
no longer “participating” in the listed transaction.
But that is not the end of the story. Many taxpayers who are no longer taking current tax deductions for these plans
continue to enjoy the benefit of previous tax deductions by continuing the deferral of income from contributions and
deductions taken in prior years. While the regulations do not expand on what constitutes “reflecting the tax
consequences of the strategy,” it could be argued that continued benefit from a tax deferral for a previous tax deduction
is within the contemplation of a “tax consequence” of the plan strategy. Also, many taxpayers who no longer make
contributions or claim tax deductions continue to pay administrative fees. Sometimes, money is taken from the plan to
pay premiums to keep life insurance policies in force. In these ways, it could be argued that these taxpayers are still
“contributing,” and thus still must file Form 8886.
It is clear that the extent to which a taxpayer benefits from the transaction depends on the purpose of a particular
transaction as described in the published guidance that caused such transaction to be a listed transaction. Revenue
Ruling 2004-20, which classifies 419(e) transactions, appears to be concerned with the employer’s
contribution/deduction amount rather than the continued deferral of the income in previous years. This language may
provide the taxpayer with a solid argument in the event of an audit.
Lance 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, financial and estate planning, and abusive tax shelters. He
writes about 412(i), 419, and captive insurance plans; speaks at more than ten conventions annually; writes for over
fifty publications; is quoted regularly in the press; and has been featured on TV and radio financial talk shows. Lance
has written numerous books including Protecting Clients from Fraud, Incompetence and Scams (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. Contact him at 516.938.5007, firstname.lastname@example.org or visit www.
taxadvisorexperts.org or www.taxaudit419.com
68 Keswick Lane
Plainview, NY 11803
Fax: (516)938-6330 www.vebaplan.com,
National Society of Accountants Speaker of The Year
The information provided herein is not intended as legal, accounting, financial or any type of advice for any specific
individual or other entity. You should contact an appropriate professional for any such advice.
IRS Audits 419, 412i, Captive Insurance Plans With Life Insurance, and
Section 79 Scams
Article Biz June 2011
The IRS started auditing 419 plans in the ‘90s, and then continued going after 412i and other plans
that they considered abusive, listed, or reportable transactions. Listed designated as listed in
published IRS material available to the general public or transactions that are substantially similar to
the specific listed transactions. A reportable transaction is defined simply as one that has the potential
for tax avoidance or evasion.
In a recent Tax Court Case, Curcio v. Commissioner (TC Memo 2010-15), the Tax Court ruled that
an investment in an employee welfare benefit plan marketed under the name "Benistar" was a listed
transaction in that the transaction in question was substantially similar to the transaction described in
IRS Notice 95-34. A subsequent case, McGehee Family Clinic, largely followed Curcio, though it
was technically decided on other grounds. The parties stipulated to be bound by Curcio on the issue
of whether the amounts paid by McGehee in connection with the Benistar 419 Plan and Trust were
deductible. Curcio did not appear to have been decided yet at the time McGehee was argued. The
McGehee opinion (Case No. 10-102) (United States Tax Court, September 15, 2010) does contain an
exhaustive analysis and discussion of virtually all of the relevant issues.
Taxpayers and their representatives should be aware that the Service has disallowed deductions for
contributions to these arrangements. The IRS is cracking down on small business owners who
participate in tax reduction insurance plans and the brokers who sold them. Some of these plans
include defined benefit retirement plans, IRAs, or even 401(k) plans with life insurance.
In order to fully grasp the severity of the situation, one must have an understanding of Notice 95-34,
which was issued in response to trust arrangements sold to companies that were designed to provide
deductible benefits such as life insurance, disability and severance pay benefits. The promoters of
these arrangements claimed that all employer contributions were tax-deductible when paid, by relying
on the 10-or-more-employer exemption from the IRC § 419 limits. It was claimed that permissible
tax deductions were unlimited in amount.
In general, contributions to a welfare benefit fund are not fully deductible when paid. Sections 419
and 419A impose strict limits on the amount of tax-deductible prefunding permitted for contributions
to a welfare benefit fund. Section 419A(F)(6) provides an exemption from Section 419 and Section
419A for certain "10-or-more employers" welfare benefit funds. In general, for this exemption to
apply, the fund must have more than one contributing employer, of which no single employer can
contribute more than 10% of the total contributions, and the plan must not be experience-rated with
respect to individual employers.
According to the Notice, these arrangements typically involve an investment in variable life or
universal life insurance contracts on the lives of the covered employees. The problem is that the
employer contributions are large relative to the cost of the amount of term insurance that would be
required to provide the death benefits under the arrangement, and the trust administrator may obtain
cash to pay benefits other than death benefits, by such means as cashing in or withdrawing the cash
value of the insurance policies. The plans are also often designed so that a particular employer’s
contributions or its employees’ benefits may be determined in a way that insulates the employer to a
significant extent from the experience of other subscribing employers. In general, the contributions
and claimed tax deductions tend to be disproportionate to the economic realities of the arrangements.
Benistar advertised that enrollees should expect to obtain the same type of tax benefits as listed in the
transaction described in Notice 95-34. The benefits of enrollment listed in its advertising packet
Virtually unlimited deductions for the employer;
Contributions could vary from year to year;
Benefits could be provided to one or more key executives on a selective basis;
No need to provide benefits to rank-and-file employees;
Contributions to the plan were not limited by qualified plan rules and would not interfere with
pension, profit sharing or 401(k) plans;
Funds inside the plan would accumulate tax-free;
Beneficiaries could receive death proceeds free of both income tax and estate tax;
The program could be arranged for tax-free distribution at a later date;
Funds in the plan were secure from the hands of creditors.
The Court said that the Benistar Plan was factually similar to the plans described in Notice 95-34 at
all relevant times.
In rendering its decision the court heavily cited Curcio, in which the court also ruled in favor of the
IRS. As noted in Curcio, the insurance policies, overwhelmingly variable or universal life policies,
required large contributions relative to the cost of the amount of term insurance that would be
required to provide the death benefits under the arrangement. The Benistar Plan owned the insurance
Following Curcio, as the parties had stipulated, on the question of the amnesty paid by Mcghee in
connection with benistar, the Court held that the contributions to Benistar were not deductible under
section 162(a) because participants could receive the value reflected in the underlying insurance
policies purchased by Benistar—despite the payment of benefits by Benistar seeming to be contingent
upon an unanticipated event (the death of the insured while employed). As long as plan participants
were willing to abide by Benistar’s distribution policies, there was no reason ever to forfeit a policy
to the plan. In fact, in estimating life insurance rates, the taxpayers’ expert in Curcio assumed that
there would be no forfeitures, even though he admitted that an insurance company would generally
assume a reasonable rate of policy lapses.
The McGehee Family Clinic had enrolled in the Benistar Plan in May 2001 and claimed deductions
for contributions to it in 2002 and 2005. The returns did not include a Form 8886, Reportable
Transaction Disclosure Statement, or similar disclosure.
The IRS disallowed the latter deduction and adjusted the 2004 return of shareholder Robert Prosser
and his wife to include the $50,000 payment to the plan. The IRS also assessed tax deficiencies and
the enhanced 30% penalty totaling almost $21,000 against the clinic and $21,000 against the
Prossers. The court ruled that the Prossers failed to prove a reasonable cause or good faith exception.
More you should know:
In recent years, some section 412(i) plans have been funded with life insurance using face amounts
in excess of the maximum death benefit a qualified plan is permitted to pay. Ideally, the plan should
limit the proceeds that can be paid as a death benefit in the event of a participant’s death. Excess
amounts would revert to the plan. Effective February 13, 2004, the purchase of excessive life
insurance in any plan makes the plan a listed transaction if the face amount of the insurance exceeds
the amount that can be issued by $100,000 or more and the employer has deducted the premiums for
A 412(i) plan in and of itself is not a listed transaction; however, the IRS has a task force auditing
An employer has not engaged in a listed transaction simply because it is in a 412(i) plan.
Just because a 412(i) plan was audited and sanctioned for certain items, does not necessarily mean
the plan is a listed transaction. Some 412(i) plans have been audited and sanctioned for issues not
related to listed transactions.
Companies should carefully evaluate proposed investments in plans such as the Benistar Plan. The
claimed deductions will not be available, and penalties will be assessed for lack of disclosure if the
investment is similar to the investments described in Notice 95-34. In addition, under IRC 6707A,
IRS fines participants a large amount of money for not properly disclosing their participation in listed
or reportable or similar transactions; an issue that was not before the Tax Court in either Curcio or
McGehee. The disclosure needs to be made for every year the participant is in a plan. The forms
need to be properly filed even for years that no contributions are made. I have received numerous
calls from participants who did disclose and still got fined because the forms were not prepared
properly. A plan administrator told me that he assisted hundreds of his participants file forms, and
they still all received very large IRS fines for not properly filling in the forms.
IRS has been attacking all 419 welfare benefit plans, many 412i retirement plans, captive insurance
plans with life insurance in them, and Section 79 plans.
Lance 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, email@example.com or visit
The information provided herein is not intended as legal, accounting, financial or any type of advice
for any specific individual or other entity. You should contact an appropriate professional for any
Remodeling Hanley / Wood
No Shelter Here September 2011
Backlash on too-good-to-be-true insurance plan
By: Lance Wallach
During the past few years, the Internal Revenue Service (IRS) has fined many business owners hundreds of
thousands of dollars for participating in several particular types of insurance plans.
The 412(i), 419, captive insurance, and section 79 plans were marketed as a way for small-business owners to
set up retirement, welfare benefit plans, or other tax-deductible programs while leveraging huge tax savings,
but the IRS put most of them on a list of abusive tax shelters, listed transactions, or similar transactions, etc.,
and has more recently focused audits on them. Many accountants are unaware of the issues surrounding these
plans, and many big-name insurance companies are still encouraging participation in them.
The plans are costly up-front, but your money builds over time, and there’s a large payout if the money is
removed before death. While many business owners have retirement plans, they also must care for their
employees. With one of these plans, business owners are not required to give their workers anything.
Although small business has taken a recessionary hit and owners may not be spending big sums on insurance
now, an IRS task force is auditing people who bought these as early as 2004. There is no statute of limitations.
The IRS also requires participants to file Form 8886 informing the IRS of participation in this “abusive
transaction.” Failure to file or to file incorrectly will cost the business owner interest and penalties. Plus, you’
ll pay back whatever you claimed for a deduction, and there are additional fines — possibly 70% of the tax
benefit you claim in a year. And, if your accountant does not confidentially inform on you, he or she will get
fined $100,000 by the IRS. Further, the IRS can freeze assets if you don’t pay and can fine you on a corporate
and a personal level despite the type of business entity you have.
Currently, small businesses facing audits and potentially huge tax penalties over these plans are filing
lawsuits against those who marketed, designed, and sold the plans. Find out promptly if you have one of these
plans and seek advice from a knowledgeable accountant to help you properly file Form 8886.
Lance 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, firstname.lastname@example.org or visit www.
The information provided herein is not intended as legal, accounting, financial or any type of advice for any
specific individual or other entity. You should contact an appropriate professional for any such advice.
Don’t Become a ‘Material Advisor’
July 1, 2011
By Lance Wallach
Accountants, insurance professionals and others need to be careful that they don’t become what the IRS calls material
If they sell or give advice, or sign tax returns for abusive, listed or similar plans; they risk a minimum $100,000 fine.
They will then probably be sued by their client, when the IRS finishes with their client
In 2010, the IRS raided the offices of Benistar in Simsbury, Conn., and seized the retirement benefit plan
administration firm’s files and records. In McGehee Family Clinic, the Tax Court ruled that a clinic and shareholder’s
investment in an employee benefit plan marketed under the name “Benistar” was a listed transaction because it was
substantially similar to the transaction described in Notice 95-34 (1995-1 C.B. 309). This is at least the second case in
which the court has ruled against the Benistar welfare benefit plan, by denominating it a listed transaction.
The McGehee Family Clinic enrolled in the Benistar Plan in May 2001 and claimed deductions for contributions to it
in 2002 and 2005. The returns did not include a Form 8886, Reportable Transaction Disclosure Statement, or similar
disclosure. The IRS disallowed the latter deduction and adjusted the 2004 return of shareholder Robert Prosser and his
wife to include the $50,000 payment to the plan.
The IRS assessed tax deficiencies and the enhanced 30 percent penalty under Section 6662A, totaling almost $21,000,
against the clinic and $21,000 against the Prossers. The court ruled that the Prossers failed to prove a reasonable cause
or good faith exception.
In rendering its decision, the court cited Curcio v. Commissioner, in which the court also ruled in favor of the IRS. As
noted in Curcio, the insurance policies, which were overwhelmingly variable or universal life policies, required large
contributions relative to the cost of the amount of term insurance that would be required to provide the death benefits
under the arrangement. The Benistar Plan owned the insurance contracts. The excessive cost of providing death
benefits was a reason for the court’s finding in Curcio that tax deductions had been properly disallowed.
As in Curcio, the McGehee court held that the contributions to Benistar were not deductible under Section 162(a)
because the participants could receive the value reflected in the underlying insurance policies purchased by Benistar—
despite the payment of benefits by Benistar seeming to be contingent upon an unanticipated event (the death of the
insured while employed). As long as plan participants were willing to abide by Benistar’s distribution policies, there
was no reason ever to forfeit a policy to the plan. In fact, in estimating life insurance rates, the taxpayers’ expert in
Curcio assumed that there would be no forfeitures, even though he admitted that an insurance company would
generally assume a reasonable rate of policy lapse.
Companies should carefully evaluate their proposed investments in plans such as the Benistar Plan. The claimed
deductions will be disallowed, and penalties will be assessed for lack of disclosure if the investment is similar to the
investments described in Notice 95-34, that is, if the transaction is a listed transaction and Form 8886 is either not
filed at all or is not properly filed. The penalties, though perhaps not as severe, are also imposed for reportable
transactions, which are defined as transactions having the potential for tax avoidance or evasion.
Insurance agents have been selling such abusive plans since the 1990's. They started as 419A(F)(6) plans and abusive
412i plans. The IRS went after them. They then evolved to single-employer 419(e) plans, which the IRS also went
after. The latest scams may be the so-called captive insurance plan and the so called Section 79 plan.
While captive insurance plans are legitimate for large corporations, they are usually not legitimate for small business
owners as a way to obtain a tax deduction. I have not yet seen a legitimate Section 79 plan. Recently, I have sent some
of the plan promoters’ materials over to my IRS contacts, who were very interested in receiving them. Some of my
associates are already trying to help defend some unsuspecting business owners who are being audited by the IRS with
respect to these plans.
Similar, though perhaps not as abusive, plans fail after the IRS goes after them. Niche was one example. The company
first marketed a 419A(F)(6) plan that the IRS audited. They then marketed a 419(e) plan that the IRS audited. Niche,
insurance companies, agents, and many accountants were then sued after their clients lost their deductions, paid fines,
interest, and penalties, and then paid huge fines for failure to file properly under 6707A. Niche then went out of
Millennium sold 419A(F)(6) plans and then 419(e) plans through insurance companies. They stupidly filed for a
private letter ruling to the effect that they were not a listed transaction. They got exactly the opposite: a private letter
ruling saying that they were a listed transaction. Then many participants were audited. The IRS disallowed the
deductions, imposed penalties and interest, and then assessed large fines for not filing properly under Section 6707A.
The result was lawsuits against agents, insurance companies and accountants. Millennium sought bankruptcy
protection after a lot of lawsuits.
I have been an expert witness in a lot of the lawsuits in these 419, 412i, etc., plans, and my side has never lost a case. I
have received thousands of phone calls over the years from business owners, accountants, angry plan promoters,
insurance agents, etc. In the 1990's, when I started writing for the AICPA and other publications warning about these
abusive plans, most people laughed at me, especially the plan promoters.
In 2002, when I spoke at the annual national convention of the American Society of Pension Actuaries in Washington,
people took notice. The IRS chief actuary Jim Holland also held a meeting, similar to mine on abusive 412i plans.
Many IRS agents attended my meeting. I was also invited to IRS headquarters, at the request of the acting IRS
commissioner, to meet with high-level IRS officials and Treasury officials to discuss 419 issues in depth, which I did
after the meeting.
The IRS then set up task forces and started going after 419 and 412i plans. I have been warning accountants to
properly file under 6707A to avoid the large fines, but most do not. Even if they file, if they make a mistake on the
forms the IRS fines. Very few accountants have had experience filing the forms, and the IRS instructions are difficult
to follow. I only know of two people who have been successful in properly filing the forms, especially after the fact.
If the forms are filled out wrong they should be amended and corrected Most accountants call me a few years later
when they and their clients get the large fines, either after improperly filling out the forms or not doing them at all, but
then it is too late. If they don’t call me then, then they call me when their clients sue them.
Lance Wallach is a frequent speaker on retirement plans, financial and estate planning, and abusive tax shelters, and
writes about 412(i), 419 and captive insurance plans. He can be reached at (516) 938-5007, email@example.com, or
Living the perfect tax-savings fantasy
BLACKMAN ON TAXES
BY IRVING BLACKMAN
A common sport at our office is a bull session with the specific goal of creating new ways to beat up the IRS –
but always legally. The conversation invariably turns to an all-important question: How do we get our
clients into a tax-free environment? To Read More Click Link Below:
The IRS Raids Plan Promoter Benistar, and What Does All This Mean To You?
Posted: Dec. 9
By Lance Wallach
Recently IRS raided Benistar, which is also known as the Grist Mill Trust, the promoter and operator of one of
the better known and more heavily scrutinized of the Section 419 life insurance plans. IRS attacked the Benistar
419 plan, and one of its tactics was to demand the names of all the clients Benistar worked with — so they
could be audited by the IRS, Benistar refused to give the names and actually appealed the decision to turn over
the names. The appeal was unsuccessful, but Benistar officials still refused to give up the names. Recently, the
IRS raided the Benistar office and took hundreds of boxes of information, which included information on clients
who were in their 419 plan. In documents filed by Benistar itself, they stated that 35 to 50 armed IRS agents
descended upon their office to seize documents. To Read MoreClick Below:+
DEPARTMENT OF THE TREASURY
INTERNAL REVENUE SERVICE
WASHINGTON, D,C. 20224
MEMORANDUM FOR COMMISSIONER, LARGE BUSINESS AND INTERNATIONAL
COMMISIONER, ~ BUSINESS/SELF-EMPLOYED
Deputy Commissioner for Services and Enforcement
Guidance for Opt Out and Removal of Taxpayers from the Civil
Settlement Structure of the 2009 Offshore Voluntary Disclosure
Program (2009 OVDP) and the 2011 Offshore Voluntary
Disclosure Initiative (2011 OVD!)
To Read More:C:\Documents and Settings\lance\Desktop\Dathonie\8-14 OVDI_Memo.pdf
Want to get your money back from your broker, insurance agent, shoe salesman or Insurance Company.
As an expert witness Lance Wallach's side has never lost a case.
Securities Fraud and Other Investment Losses/fraudulent sales practices: Some of the more common securities
liability issues include: the placement of unauthorized transactions, the recommendation of unsuitable transactions,
over-concentration of certain positions in an account, churning, annuity switching, failure to execute trades,
excessive or unsuitable use of margin, selling away, theft from an account, negligent retirement advice,
misrepresentations or omissions regarding investments, recommendation of variable annuities, forged documents,
options fraud, unsuitable welfare benefit plans, abuse of a vulnerable adult, whistleblower, or negligent investment
Unauthorized trading occurs when a trading account is non-discretionary (that is the broker is not provided with
authority to execute trades on his/her own) and the broker places a trade without the customer’s authority.
To Read More Click Link Below:
NOVA Benefit Plans: IRS Cracking Down on Welfare Benefit Plans
On June 1, 2011, I was again contacted by the attorney representing Daniel Carpenter, this time threatening to sue
me if I did not remove the article from my site.
The article in question was not defamatory. It simply discussed the allegations made by the IRS and the potential
problems NOVA was facing, and quoted and linked to other articles on Nova and Benestar.
If you wish to research NOVA Benefit Plans LLC of Simsbury, Connecticut, Section 419 of the Internal Revenue
Service code, welfare benefit plans accused of being abusive tax shelters, and please visit the sites listed below.the
criminal investigation of NOVA and the “armed assault” raid of Nova’s Grist Mill offices by the IRS.
To Read More Click Link Below:
How can a IRS Penalty Abatement help?
When the IRS assesses tax debt penalties, those penalties are added automatically to the taxpayer's account
by the IRS computer system. Because of this, penalties are frequently added to a taxpayer's debt without
taking his or her individual circumstances into account. And as you may have already discovered, IRS Tax
Penalties can turn a fairly manageable debt into an overwhelming burden pretty much overnight.
A proper Penalty Abatement requires very specific wording and a solid understanding of the relevant IRS
Code and Procedure. Even if you had a good reason for not paying your taxes on time, it is often extremely
difficult to get these penalties removed without professional help.
In 2012, the IRS issued over $26,864,993,000.00 (that's 26.9 Billion Dollars) in penalties!
Requesting a Penalty Abatement requires that you have a good reason. What qualifies as a good reason?
It depends on the circumstances involved with your particular situation.
The procedures for deciding who qualifies for a Penalty Abatement and for what reason seem to differ in
The best thing you can do is to request that the IRS abate your penalties by providing the circumstances
surrounding your situation.
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