Monthly Archives: March 2026

U.S. multinationals used new FASB-mandated tax disclosures to reveal that 40 large corporations cut their 2025 tax bills by over $11.5 billion through profit shifting to low‑tax jurisdictions, especially in pharma and biotech, according to a FACT Coalition analysis.

Key findings

FACT reviewed 2025 financials under FASB ASU 2023‑09, which requires public companies to disaggregate income tax expense by jurisdiction, tax credits, and policy effects, making effective tax rate drivers much more transparent to investors. FACT’s review shows that ten pharma/biotech companies, including AbbVie, Merck, Pfizer, Johnson & Johnson, and others, reported especially large tax savings attributable to tax haven jurisdictions. Four locations—Ireland, the Netherlands, Puerto Rico, and Switzerland—accounted for about 70% of all identified tax‑haven savings, even though they rarely appear on formal blacklist or graylist compilations.

Limits of current U.S. rules

The report concludes that existing U.S. anti‑abuse regimes, including GILTI and Subpart F, are inadequate because they recaptured only about $3 billion of the $11.5 billion in tax‑haven savings for the 40 corporations examined. Georges notes that, through the start of 2026, general foreign income was effectively taxed at about half the domestic statutory corporate rate and further reduced by a “substance carve‑out” for foreign tangible assets, which encouraged profit shifting within the bounds of current law. The One Big Beautiful Bill Act removed this substance carve‑out and made some tightening changes, but FACT argues that the overall international reforms still leave ample room for aggressive tax planning.

Interaction with Pillar Two and CAMT

OECD Pillar Two’s 15% global minimum tax is starting to erode tax incentives in some jurisdictions, such as Singapore, where minimum‑tax rules are overriding company‑specific preferential deals. However, aspects of the U.S. “side‑by‑side” implementation mean that certain Pillar Two provisions do not fully apply to U.S. multinationals, while domestic rules like the corporate alternative minimum tax have been weakened through recent regulatory guidance. Georges urges the U.S. to at least meet the Pillar Two minimum standard by tightening its own regimes rather than diluting them.

Policy and enforcement outlook

Georges sees bipartisan interest in “leveling the playing field” between large multinationals and purely domestic or mid‑sized businesses, but he does not expect major reforms in the current Congress. He emphasizes that stronger IRS funding—particularly for enforcement—is necessary to police abusive structures, yet many strategies highlighted in the FACT study are legal and even incentivized, so structural Tax Code changes will also be required to materially curb profit shifting.

Sources:

1.       https://tax.thomsonreuters.com/news/disclosures-show-us-corporations-cut-tax-bills-by-billions-last-year-using-tax-havens-says-group/    

2.      https://www.aicpa-cima.com/resources/article/asu-2023-09-income-tax-disclosures

3.      https://www.hklaw.com/en/insights/publications/2025/07/a-look-at-the-international-tax-changes-in-the-obbb-act

4.      https://www.wilmerhale.com/en/insights/client-alerts/20250714-international-tax-provisions-of-the-one-big-beautiful-bill-act-obbba

5.       https://thefactcoalition.org/major-american-corporations-saved-billions-through-tax-havens/ 

6.      https://www.cshco.com/insights/fasb-accounting-standards-update-for-income-taxes-asu-2023-09

7.       https://thefactcoalition.org/resources/

8.      https://ctj.sfo2.digitaloceanspaces.com/pdf/pre0414.pdf

9.      https://www.linkedin.com/posts/fact-coalition_big-us-corporations-reaped-billions-through-activity-7437558984779358208-7yR7

10.   https://www.plantemoran.com/explore-our-thinking/insight/2025/11/asu-2023-09-aims-to-enhance-transparency-in-income-tax-disclosures

11.    https://www.taxexecutive.org/the-one-big-beautiful-bill-act/

12.   https://thefactcoalition.org/just-the-facts-3-19-26/

13.   https://thefactcoalition.org/tag/fasb/

14.   https://thefactcoalition.org

15.    https://thefactcoalition.org/issues/tax-transparency/

Read more at: Tax Times blog

United States v. Schwarzbaum, No. 9:18‑cv‑81147 (S.D. Fla.), has become one of the most influential FBAR cases in the Eleventh Circuit, especially for willful penalties on foreign accounts. Across multiple appeals, it clarifies the civil willfulness standard, how courts review FBAR penalty computations, and how the Eighth Amendment’s Excessive Fines Clause limits willful FBAR penalties.

Background and Willfulness

Isac Schwarzbaum, a dual U.S.–German citizen with long‑standing Swiss accounts, failed to file complete and accurate FBARs for several years; the IRS initially assessed roughly $13.7 million in willful FBAR penalties using a 50%‑of‑highest‑balance methodology for 2006–2009. After a bench trial, the Southern District of Florida found willful (reckless) FBAR violations for 2007–2009, not 2006, and entered judgment of about $12.56 million plus interest and additions.

On appeal, the Eleventh Circuit confirmed that recklessness is enough to establish civil FBAR willfulness, aligning with other circuits and its prior decision. The court highlighted factors like the taxpayer’s sophistication, the history and size of the foreign accounts, prior professional advice, and the implausibility of claimed ignorance—illustrating that a pattern of disregard can satisfy willfulness even without direct evidence of intent.

APA Review of Penalty Computations

A central contribution of Schwarzbaum is procedural: FBAR penalty assessments are agency action subject to the Administrative Procedure Act. The district court believed the IRS mis‑computed the penalties and tried to correct them by plugging in its own numbers, but the Eleventh Circuit held that the proper remedy is to vacate and remand to the IRS, not for the court to recalculate the penalties itself.

On remand, the Service recomputed the penalties (still in the multi‑million‑dollar range), and the government sought judgment consistent with the original approximate $12.56 million cap plus statutory additions. For practitioners, this means FBAR litigation typically has two distinct fronts: (1) contesting willfulness and (2) attacking the IRS’s methodology as arbitrary or contrary to statute, with any recalculation occurring at the agency level.

The Excessive Fines Clause and FBAR Penalties

More recently, the Eleventh Circuit held that willful FBAR penalties are “fines” for Eighth Amendment purposes because they are at least partly punitive. Applying the Supreme Court’s Bajakajian “gross disproportionality” test, the court evaluated the penalties on an account‑by‑account basis and focused on one small Swiss account with modest balances that nonetheless generated flat $100,000 willful penalties per year.

The panel concluded that roughly $300,000 of those penalties was constitutionally excessive and ordered that amount reduced while leaving the bulk of the more than $12 million in penalties intact. The Department of Justice has indicated it will not seek Supreme Court review of this Excessive Fines holding, solidifying its precedential force within the Eleventh Circuit for now.

Enforcement and Practical Takeaways

Even after the constitutional reduction, Schwarzbaum faces a substantial judgment that, with interest and additions, has approached the high teens in millions of dollars. The government has actively pursued enforcement, including orders compelling repatriation of foreign assets to satisfy the judgment, underscoring that collection can reach offshore funds once a willful FBAR judgment is in place.

For taxpayers and advisors, Schwarzbaum offers several key lessons:

·         Willfulness is broad. Recklessness and willful blindness can support willful FBAR penalties, particularly for sophisticated taxpayers with long‑standing foreign accounts or prior compliance warnings.

·         Penalty math is litigable. Courts can vacate arbitrary FBAR computations under the APA and send them back to the IRS, even though judges cannot simply substitute their own calculations.

·         Eighth Amendment arguments are viable in the Eleventh Circuit. Disproportionate penalties—especially where statutory minimums greatly exceed small account balances—may be reduced as excessive on an account‑by‑account basis.

·         Early remediation still matters. The case illustrates both the magnitude of risk in willful FBAR matters and the limited nature of relief even when an Excessive Fines claim succeeds, reinforcing the value of timely voluntary disclosure or other remedial strategies.

For high‑net‑worth individuals with foreign accounts, Schwarzbaum is a cautionary tale: large willful FBAR penalties are real, enforceable, and now subject to constitutional scrutiny, but only at the margins.

 Do You Have Undeclared Offshore Income?

Sources

1.       http://uniset.ca/fatca3/schwarzbaum_sdfla_govt_motion_exclude_admin_materials.pdf 

2.      https://www.govinfo.gov/content/pkg/USCOURTS-flsd-9_18-cv-81147/pdf/USCOURTS-flsd-9_18-cv-81147-11.pdf 

3.      https://www.journalofaccountancy.com/issues/2025/aug/eleventh-circuit-finds-some-fbar-penalties-are-excessive/ 

4.      https://www.govinfo.gov/content/pkg/USCOURTS-flsd-9_18-cv-81147/pdf/USCOURTS-flsd-9_18-cv-81147-5.pdf 

5.       https://www.justice.gov/oip/media/1397701/dl?inline   

6.      https://freemanlaw.com/willful-fbar-penalties-and-a-district-courts-authority-to-remand-irs-willful-penalty-computations/

7.       https://bankingjournal.aba.com/2024/10/eleventh-circuit-holds-that-willful-fbar-penalties-are-subject-to-the-eighth-amendments-excessive-fines-clause/

8.      https://freemanlaw.com/eleventh-circuit-holds-willful-fbar-penalties-unconstitutional/

9.      https://www.law360.com/articles/2454212/-20m-fbar-judgment-didn-t-need-jury-trial-judge-says

10.   https://media.ca11.uscourts.gov/opinions/pub/files/202214058.op2.pdf

11.    https://www.govinfo.gov/content/pkg/USCOURTS-flsd-9_18-cv-81147/pdf/USCOURTS-flsd-9_18-cv-81147-0.pdf

12.   https://ogletree.com/insights-resources/blog-posts/court-extends-acts-deadline-to-march-25-for-plaintiff-states-as-legal-challenge-proceeds

13.   https://case-law.vlex.com/vid/united-states-v-schwarzbaum-1062021228

14.   https://www.chamberlainlaw.com/assets/htmldocuments/Suprising FBAR Cases A Mixed Bag for Tax Payers Facing Foreign Account Penalties.pdf

15.    https://steinsperling.com/january-federal-tax-update-3/

16.   https://media.ca11.uscourts.gov/opinions/pub/files/202214058.pdf    

17.    https://www.journalofaccountancy.com/issues/2025/aug/eleventh-circuit-finds-some-fbar-penalties-are-excessive/      

18.   https://freemanlaw.com/willful-fbar-penalties-and-a-district-courts-authority-to-remand-irs-willful-penalty-computations/              

19.   https://freemanlaw.com/fbar-a-catalogue-of-fbar-cases/united-states-v-schwarzbaum-fbar-series/   

20.  https://www.law360.com/articles/2448440/fla-court-urged-to-toss-19m-tax-fine-decided-with-no-jury 

21.   https://www.law360.com/articles/2454212/-20m-fbar-judgment-didn-t-need-jury-trial-judge-says  

22.   https://www.justice.gov/oip/media/1397701/dl?inline  

23.   http://www.uniset.ca/fatca3/Finally_a_Taxpayer_Victory.html    

24.  https://www.thetaxadviser.com/issues/2024/nov/fbar-penalties-can-violate-excessive-fines-clause/     

25.   http://citizenshipsolutions.ca/2024/11/12/schwarzbaum-willfulness-in-a-civil-fbar-penalty-vs-willfulness-in-a-criminal-fbar-penalty/ 

26.  https://bankingjournal.aba.com/2024/10/eleventh-circuit-holds-that-willful-fbar-penalties-are-subject-to-the-eighth-amendments-excessive-fines-clause/  

27.   https://www.globalcompliancenews.com/2024/10/15/united-states-schwarzbaum-eleventh-circuit-holds-fbar-penalties-subject-to-eighth-amendment/  

28.  https://www.govinfo.gov/content/pkg/USCOURTS-flsd-9_18-cv-81147/pdf/USCOURTS-flsd-9_18-cv-81147-5.pdf 

29.  https://taxcontroversy.foxrothschild.com/2024/09/fbar-the-eleventh-circuit-holds-that-willful-fbar-penalties-are-subject-to-the-eighth-amendment-creating-circuit-split/ 

30.  https://www.law360.com/tax/news?amp%3Bpage=583&page=3

31.   https://www.nyulawglobal.org/globalex/fatca_citizenship_based_taxation1.html

32.   https://freemanlaw.com/eleventh-circuit-holds-willful-fbar-penalties-unconstitutional/

33.   https://freemanlaw.com/willful-fbar-penalties-and-a-district-courts-authority-to-remand-irs-willful-penalty-computations/             

34.   https://media.ca11.uscourts.gov/opinions/pub/files/202214058.pdf     

35.   https://freemanlaw.com/fbar-a-catalogue-of-fbar-cases/united-states-v-schwarzbaum-fbar-series/     

36.   https://bankingjournal.aba.com/2024/10/eleventh-circuit-holds-that-willful-fbar-penalties-are-subject-to-the-eighth-amendments-excessive-fines-clause/      

37.   https://www.journalofaccountancy.com/issues/2025/aug/eleventh-circuit-finds-some-fbar-penalties-are-excessive/         

38.  https://www.globalcompliancenews.com/2024/10/15/united-states-schwarzbaum-eleventh-circuit-holds-fbar-penalties-subject-to-eighth-amendment/      

39.   https://www.justice.gov/oip/media/1397701/dl?inline     

40.  http://citizenshipsolutions.ca/2024/11/12/schwarzbaum-willfulness-in-a-civil-fbar-penalty-vs-willfulness-in-a-criminal-fbar-penalty/   

41.   http://www.uniset.ca/fatca3/Finally_a_Taxpayer_Victory.html    

42.  https://www.thetaxadviser.com/issues/2024/nov/fbar-penalties-can-violate-excessive-fines-clause/       

43.   https://www.law360.com/articles/2454212/-20m-fbar-judgment-didn-t-need-jury-trial-judge-says  

44.  https://www.govinfo.gov/content/pkg/USCOURTS-flsd-9_18-cv-81147/pdf/USCOURTS-flsd-9_18-cv-81147-5.pdf  

45.   https://www.govinfo.gov/content/pkg/USCOURTS-flsd-9_18-cv-81147/pdf/USCOURTS-flsd-9_18-cv-81147-11.pdf

46.  https://www.law360.com/articles/2448440/fla-court-urged-to-toss-19m-tax-fine-decided-with-no-jury

47.   https://taxcontroversy.foxrothschild.com/2024/09/fbar-the-eleventh-circuit-holds-that-willful-fbar-penalties-are-subject-to-the-eighth-amendment-creating-circuit-split/ 

48.  http://uniset.ca/fatca3/schwarzbaum_sdfla_govt_motion_exclude_admin_materials.pdf

49.  https://www.govinfo.gov/content/pkg/USCOURTS-flsd-9_18-cv-81147/pdf/USCOURTS-flsd-9_18-cv-81147-5.pdf

50.  https://media.ca11.uscourts.gov/opinions/pub/files/202214058.op2.pdf

51.    https://www.govinfo.gov/content/pkg/USCOURTS-flsd-9_18-cv-81147/pdf/USCOURTS-flsd-9_18-cv-81147-0.pdf

52.   https://www.govinfo.gov/content/pkg/USCOURTS-flsd-9_18-cv-81147/pdf/USCOURTS-flsd-9_18-cv-81147-11.pdf

53.   https://freemanlaw.com/willful-fbar-penalties-and-a-district-courts-authority-to-remand-irs-willful-penalty-computations/

54.   https://ogletree.com/insights-resources/blog-posts/court-extends-acts-deadline-to-march-25-for-plaintiff-states-as-legal-challenge-proceeds

55.   https://case-law.vlex.com/vid/united-states-v-schwarzbaum-1062021228

56.   https://bankingjournal.aba.com/2024/10/eleventh-circuit-holds-that-willful-fbar-penalties-are-subject-to-the-eighth-amendments-excessive-fines-clause/

57.   https://www.chamberlainlaw.com/assets/htmldocuments/Suprising FBAR Cases A Mixed Bag for Tax Payers Facing Foreign Account Penalties.pdf

58.  https://www.law360.com/articles/2454212/-20m-fbar-judgment-didn-t-need-jury-trial-judge-says

59.   https://www.journalofaccountancy.com/issues/2025/aug/eleventh-circuit-finds-some-fbar-penalties-are-excessive/

60.  https://freemanlaw.com/eleventh-circuit-holds-willful-fbar-penalties-unconstitutional/

61.   https://www.justice.gov/oip/media/1397701/dl?inline

62.  https://steinsperling.com/january-federal-tax-update-3/

63.   https://www.law360.com/articles/2448440/fla-court-urged-to-toss-19m-tax-fine-decided-with-no-jury

64.  https://media.ca11.uscourts.gov/opinions/pub/files/202214058.pdf

65.   https://freemanlaw.com/fbar-a-catalogue-of-fbar-cases/united-states-v-schwarzbaum-fbar-series/

66.  https://www.globalcompliancenews.com/2024/10/15/united-states-schwarzbaum-eleventh-circuit-holds-fbar-penalties-subject-to-eighth-amendment/

67.   https://www.thetaxadviser.com/issues/2024/nov/fbar-penalties-can-violate-excessive-fines-clause/

68.  http://citizenshipsolutions.ca/2024/11/12/schwarzbaum-willfulness-in-a-civil-fbar-penalty-vs-willfulness-in-a-criminal-fbar-penalty/

69.   

Read more at: Tax Times blog

 From GILTI to NCTI: what changed

·         The One Big Beautiful Bill Act (H.R. 1) replaces GILTI with net CFC tested income (NCTI) for tax years beginning after 2025, eliminating the QBAI/NDTIR exclusion and effectively taxing the first dollar of net CFC income.

·         The Section 250 deduction is reduced (generally 40% instead of 50%), moving the corporate effective federal rate on NCTI to about 12.6% starting in 2026.

·         The foreign tax credit haircut is eased from 20% to 10%, so up to 90% of foreign taxes on NCTI may be creditable federally, making it easier to shelter NCTI at the federal level when foreign effective tax rates are at or above roughly 14%.

These changes mean more foreign income is fully in the federal base, but less residual U.S. tax may be due; states conforming to the federal base can end up taxing that same income without any offsetting state-level foreign tax credit.

Where state conformity creates distortion

·         Many states piggyback on federal taxable income but do not adopt the federal foreign tax credit mechanics or baskets, and they often do not grant credits for foreign income taxes paid on NCTI.

·         Some states already treat GILTI/NCTI as dividend or subpart F–like income and include a portion (for example, 50%) in the state base without providing any factor representation for the underlying CFC property, payroll, or sales.

·         As NCTI replaces GILTI and captures broader CFC income, including income with little nexus to any given state, conforming states are pulling more foreign earnings into the base while continuing to use a purely domestic property/payroll/sales denominator, inflating the effective state tax rate on those earnings.

For multistate corporate groups with material foreign operations, this combination sets up a classic “tax base in, factors out” distortion that invites requests for alternative apportionment.

Illustration of the mechanics

Assume a U.S. corporate group with large non‑U.S. CFC operations generating significant NCTI. Federally, the group may pay little incremental tax on that NCTI after the enlarged foreign tax credit, but a conforming state that (1) includes 50–100% of the NCTI amount in the state tax base, (2) offers no foreign tax credit, and (3) refuses to include foreign property/payroll/sales in the denominator, effectively overstates the portion of global income reasonably attributable to that state.

Constitutional backbone: Kraft and foreign Commerce Clause

·         In Kraft General Foods v. Iowa, the U.S. Supreme Court struck down Iowa’s regime that allowed a dividends-received deduction for domestic, but not foreign, subsidiaries, holding that differential treatment of foreign commerce violated the Foreign Commerce Clause.

·         The Court emphasized that states may not structure their tax rules to favor domestic over foreign operations when reasonable, nondiscriminatory alternatives exist.

Applied to NCTI:

·         When a state includes NCTI (reflecting foreign subsidiary earnings) in the base but refuses to accord the same apportionment treatment (or equivalent relief) that would apply to comparable domestic subsidiary income, the regime begins to resemble the discrimination problem condemned in Kraft.

·         The discrimination can arise either from (1) including foreign income without factor representation, or (2) denying a practical equivalent to a dividends‑received deduction/credit structure that relieves double taxation for domestic but not foreign earnings.

NCTI has made the foreign‑versus‑domestic disparity more visible and more material.

Alternative apportionment and practical planning

Taxpayers may respond by:

·         Statutory and equitable relief: Most states allow petitions for alternative apportionment where the standard formula does not fairly represent the extent of a taxpayer’s business activity in the state (e.g., UDITPA‑style provisions).

·         Core argument: Including significant NCTI in the tax base without a corresponding inclusion of CFC factors produces a constitutionally suspect distortion, especially when the state also denies any credit for foreign taxes paid.

·         Litigation posture: Kraft and post‑Kraft commentary on Foreign Commerce Clause discrimination provide a roadmap for arguing that a state’s chosen method discriminates against foreign commerce and must yield to a method that affords factor representation or a comparable adjustment.

·         State conformity watching brief: States are still amending their conformity statutes in response to the One Big Beautiful Bill; some have clarified their treatment of GILTI/NCTI, others have not, and a few treat GILTI and NCTI identically for inclusion percentage purposes.

 Have an State Tax Problem?

     Contact the Tax Lawyers at

Sources:

1.       https://www.proskauertaxtalks.com/2025/07/president-trump-signs-one-big-beautiful-bill-act-into-law/     

2.      https://www.ncsl.org/fiscal/2025-tax-conformity-changes?maptype=tile          

3.      https://www.law.cornell.edu/supremecourt/text/505/71       

4.      https://altrolaw.com/new-rules-replace-the-gilti-applicable-2026/       

5.       https://www.mtc.gov/foreign-commerce-clause-discrimination-revisiting-kraft-after-wayfair/              

6.      https://www.lathamreg.com/2025/07/one-big-beautiful-bill-introduces-major-changes-to-federal-tax-law/   

7.       https://www.mayerbrown.com/en/insights/publications/2025/07/one-big-beautiful-bill-act-introduces-significant-domestic-and-international-tax-changes   

8.      https://answerconnect.cch.com/topic/546b25d07cf01000aa5990b11c18c90201/net-cfc-tested-income-ncti-formerly-global-intangible-low-taxed-income-gilti  

9.      https://pro.bloombergtax.com/insights/international-tax/how-to-calculate-gilti-tax-on-foreign-earnings/     

10.   https://gtmtax.com/insight/key-tax-code-changes-under-the-one-big-beautiful-bill/ 

11.    https://www.stateandlocaltax.com/in-the-news/is-state-conformity-to-federal-re-deductions-unconstitutional/            

12.   https://supreme.justia.com/cases/federal/us/505/71/case.pdf      

13.   https://bipartisanpolicy.org/explainer/how-does-the-2025-house-gop-tax-bill-change-international-tax-rules/

14.   https://dart.deloitte.com/USDART/home/publications/deloitte/heads-up/2025/asc-740-accounting-2025-tax-law-changes

15.    https://mcguiresponsel.com/blog/from-gilti-to-ncti-how-the-one-big-beautiful-bill-transforms-international-taxation-for-u-s-corporations/

Read more at: Tax Times blog

CIC Services has returned to federal court in Tennessee to challenge the IRS’ newest micro‑captive reporting rules, a sequel to its earlier successful attack on Notice 2016‑66.

Quick background

CIC Services, a Knoxville‑based micro‑captive manager, first sued over Notice 2016‑66, arguing it was an improperly issued legislative rule and arbitrary and capricious under the APA. That case produced the Supreme Court’s 2021 holding that the Anti‑Injunction Act did not bar a pre‑enforcement APA challenge, and on remand the district court vacated Notice 2016‑66 for APA violations.

In response, the IRS issued a new Final Rule designating certain 831(b) arrangements as listed transactions or transactions of interest, again imposing extensive reporting on participants and material advisors. The Service asserts that micro‑captives remain a vehicle for abuse and that the revised framework cures the defects in the prior notice.

The new lawsuit: 3:25‑cv‑00146

On April 9, 2025, CIC filed CIC Services, LLC v. Internal Revenue Service et al., No. 3:25‑cv‑00146, again in the Eastern District of Tennessee and again under the APA. The defendants include the United States, the IRS, Treasury, and IRS officials in their official capacities.

CIC contends the Final Rule still lacks a data‑driven basis for treating the targeted structures as potential tax‑avoidance transactions and that it exceeds the IRS’ statutory authority. The complaint also argues that the agency is effectively re‑creating the vacated Notice 2016‑66 regime in slightly revised form and seeks vacatur of the rule and an injunction against its enforcement as to CIC, its clients, and related advisors.

Practical implications

For advisors and captive managers, the operative assumption should be that the Final Rule remains enforceable unless and until a court says otherwise. That means carefully testing existing 831(b) captives against the new listed‑transaction and transaction‑of‑interest definitions and ensuring timely, accurate Forms 8886 and 8918 with strong documentation of risk‑shifting, risk distribution, and non‑tax business purpose.

The case will be an important bellwether for how far the IRS can go in imposing aggressive reportable‑transaction frameworks on perceived abusive structures, and how robustly courts will police APA compliance in the tax‑shelter context. For now, practitioners should monitor the docket and be ready to pivot quickly if the court narrows or vacates the rule for CIC or more broadly.

 Have an IRS Tax Problem?

     Contact the Tax Lawyers at

Sources:

1.       https://www.law360.com/tax/articles/2449418/overhauled-irs-microcaptive-rules-pass-muster-with-judge       

2.      https://www.captivatingthinking.com/wp-content/uploads/2025/04/CICcomplaint.pdf             

3.      https://www.captive.com/news/cic-services-files-second-lawsuit-against-irs-over-micro-captive-rules               

4.      https://www.law360.com/articles/2449418/overhauled-irs-microcaptive-rules-pass-muster-with-judge        

5.       https://www.law360.com/articles/2323774/irs-microcaptive-rules-face-challenge-by-familiar-foe         

6.      https://dockets.justia.com/docket/tennessee/tnedce/3:2025cv00146/118677   

7.       https://finance.yahoo.com/news/cic-services-files-second-lawsuit-163400535.html        

8.      https://ballotpedia.org/CIC_Services_v._Internal_Revenue_Service   

9.      https://www.captivatingthinking.com/cic-services-files-second-lawsuit-against-the-irs-continuing-fight-for-small-and-mid-sized-businesses/       

10.   https://www.law360.com/tax-authority/federal/articles/2449418/overhauled-irs-microcaptive-rules-pass-muster-with-judge

11.    https://www.sec.gov/files/litigation/apdocuments/3-17342-event-117.pdf

12.   https://portal.ct.gov/-/media/OHS/ohca/CON_Completed/2017/17_32165_CON.pdf

13.   https://litigationtracker.law.georgetown.edu/wp-content/uploads/2025/01/Tennessee_2025.02.07_PLAINTIFFS-MOTION-FOR-SUMMARY-JUDGMENT-AND-PRELIMINARY-RELIEF-AND-MEMORANDUM-IN-SUPPORT.pdf

14.   https://www.ftc.gov/system/files/ftc_gov/pdf/2023-01025_foia_logs_2022-2023.pdf

15.    https://www.sec.gov/Archives/edgar/data/1545654/000114420416084972/0001144204-16-084972.txt

16.   https://www.law360.com/tax/articles/2449418/overhauled-irs-microcaptive-rules-pass-muster-with-judge   

17.    https://www.captivatingthinking.com/wp-content/uploads/2025/04/CICcomplaint.pdf     

18.   https://www.captive.com/news/cic-services-files-second-lawsuit-against-irs-over-micro-captive-rules     

19.   https://www.law360.com/articles/2449418/overhauled-irs-microcaptive-rules-pass-muster-with-judge    

20.  https://www.law360.com/articles/2323774/irs-microcaptive-rules-face-challenge-by-familiar-foe      

21.   https://dockets.justia.com/docket/tennessee/tnedce/3:2025cv00146/118677  

22.   https://finance.yahoo.com/news/cic-services-files-second-lawsuit-163400535.html 

23.   https://ballotpedia.org/CIC_Services_v._Internal_Revenue_Service 

24.  https://www.captivatingthinking.com/cic-services-files-second-lawsuit-against-the-irs-continuing-fight-for-small-and-mid-sized-businesses/ 

25.   https://www.law360.com/tax-authority/federal/articles/2449418/overhauled-irs-microcaptive-rules-pass-muster-with-judge

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