Equipment Leasing

Big business enjoys huge tax advantages by creating Captive Insurance Companies. Successful PCs can also use this powerful tool for wealth accumulation and risk management.

The CIC underwrites risks of companies owned by the same owner(s)--risks associated with the practice or medical facility that are not easily or cheaply covered by commercial insurance.

Risks that may be covered by a CIC:
• Administrative Actions
• Computers, Data Recovery
• Key Employees
• Employee /Executive/Professional Liability
• Business Income Loss
• Litigation Expense
• eCommerce Risk
• Directors/Officers
• Kidnapping/Ransom
• Sexual Harassment
• Income Tax Indemnity
• Deductibles/Gap Coverage

Policies can be labeled “litigation expense only”—creating a pre-tax war chest to fight lawsuits, while protecting assets against claims. “Premium dollars” are moved out -- away from creditors. Because premium payments are made “for value” it’s difficult for creditors to prove fraudulent transfer.

Advantages
• Better statutory protection for reserves due to requirements to pay claims. Creditors are less likely to force judgments.

• When no longer useful, captives can be terminated, assets distributed, capital gains declared, taxes paid -- providing optimum tax benefits.

• Captives formed under 831(b) have straightforward tax reporting -- like a simple “S” corporation. Smart entrepreneurs engage professionals experienced in this section of the code to ensure compliance.