Tax Court Cites Life, Annuity Assets in 40% Penalty Ruling
May 27, 2026 by Allison Bell
A U.S. Tax Court judge has ruled that a taxpayer who set up a microcaptive property and casualty insurance arrangement that used an annuity and a life insurance policy as the only investments must add a 40% penalty, not just a 20% penalty, when he pays the Internal Revenue Service back for tax breaks he originally claimed for the years 2012 through 2015.
Curtis Kadau, the president and owner of Surface Engineering & Alloy Co., a manufacturer, said he set up the microcaptive insurance arrangement to provide insurance for his company.
Originally Posted at Think Advisor on May 26, 2026 by Allison Bell.
Categories: Industry Articles
