Captive Insure

The tax code says self-insuring risk is not deductible

1986 congress introduced 831B – farmers were ensuring their crops. This began this concept.

Below are some notes were taken on this subject:

  • Additive to regular insurance
  • Not malpractice insurance
  • Insure your brand with pre-tax dollars
  • Eligible yearly premium – 10% of gross billing from the previous year
  • Use a C-Corp
  • Why? Self-insure against low probability intangible events within your business
  • Business expense
  • Lowers your taxable income
  • Very similar to banking from yourself
  • Used to pay out for warranties for your products – use for a marketing tool for your business
  • You can leave the money in the program (insurance), borrow the money paying yourself insurance, declare a dividend
  • Congress has increased (2015 Path act) 831B to $2M with inflation rider and got rid of lineal descendants
  • Previously a red flag for tax auditing
  • Fortune 500 companies always have insurance company offshore, try to do in USA with yours
  • To ensure brand issues such a stupid comment on social media NOT incase your key employee leaves
Close Menu

SEE The Deals!

Speadsheets, mindset hacks, networking opportunities and free access to the first three modules of the Passive Investor Accelerator eCourse.  Ready To Invest With us?  

Free 15 minute
Strategy Call

Our analytics tell us most people stay on this page for 78 secs…

We figure you are a self-starter… or someone to went to school for too long ;)

No baseball glove needed… there is no pitch coming 😁