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IRS Excludes Non-Cash Value Premiums from FATCA after Ongoing Advocacy Efforts from The Council of Insurance Agents & Brokers
WASHINGTON, D.C. – December 13, 2018 – The U.S. Treasury issued regulations this morning that exclude non-cash value property/casualty insurance premiums from regulations implementing the Foreign Account Tax Compliance Act (FATCA). Today’s announcement is retroactive and applies to all open tax years.
The move is considered a major victory by The Council of Insurance Agents & Brokers and is the result of ongoing advocacy efforts in Congress and with the IRS. The Council has long argued that non-cash value insurance premiums had no relevance to tax evasion regulations.
“We’re extremely gratified this morning that the IRS excluded property/casualty insurance premiums from the FATCA reporting requirements,” said Ken A. Crerar, President/CEO of The Council. “The FATCA regulations have long been a regulatory headache for the global commercial insurance and reinsurance industry. The compliance acrobats that our members pursued to comply with the law served no purpose, as property/casualty insurance premiums have no-cash value to them and are irrelevant to the tax evasion regulations set forth by FATCA.
“We’re incredibly grateful to our legislative champions in seeing this issue through to the finish line. We simply could not have done this without their efforts. Sen. Tim Scott (R-SC), Congressman John Larson (D-CT), Congressman Jason Smith (R-MO) and Congressman Ed Royce (R-CA) have all been generous in working this issue to the end, seeking sound regulations and limiting the mindless and expensive overreach that hampered the commercial insurance brokerage industry for no public good.”
The Council has been working to achieve this clarity for its members since FATCA’s inception in 2010 and is extremely gratified to see the U.S. Treasury’s agreement. The Council is especially thankful for the team at the Treasury Department, headed by Deputy Assistant Treasury Secretary (for International Taxation) Chip Harter.