Taking my headline from an exalted source, I bring to the attention of my readers IRS Notice 2016-66, coming soon to an IRB near you.

IRS has fought with alleged micro-captive insurance companies with mixed results. The Rent-A-Center case was a major win for the captive S Corp siblings; see my blogpost “Insurance – Are You Sure?” 1/14/14.

But the captors have also taken some tough hits. See, e.g., my blogpost “No Insurance? Go Pound Sand,” 5/28/13.

Well, IRS has a checklist of phony insurance deals where there is no shifting of risk, no economic substance, no adherence to generally-accepted industry-wide practices, and a roundy-round with money to dodge taxes.

These are now “transactions of interest,” and I’ll bet they’re going to get a lot of interest.

Should be some good litigation and blogfodder coming up.