CIC Services, a captive insurance manager and strategist, is urging the US Congress to swiftly overturn a new IRS rule that imposes additional restrictions on Section 831(b), a move they say jeopardises small and mid-sized businesses' ability to manage risk through captives.
The firm notes that this regulation emerges as businesses are already contending with escalating commercial insurance premiums, higher deductibles, and diminishing coverage options.
If upheld, many enterprises could find themselves without viable alternatives for safeguarding against financial uncertainty.?
"Congress enacted the 831(b) election nearly 40 years ago to give small and mid-sized businesses a way to manage risk affordably, yet this new IRS rule severely undermines that purpose," says Sean King, CEO of CIC Services.
"Congress has a clear opportunity to act now, overturn this rule, and protect businesses from unnecessary financial hardship."
Under the Congressional Review Act (CRA), Congress has a limited timeframe to introduce a resolution to overturn this regulation. CIC Services urges lawmakers to take immediate action before it is too late.?
CIC Services calls on members of Congress to introduce a joint resolution under the CRA to disapprove of the IRS rule, acknowledge the economic harm this regulation will inflict on small businesses in their constituencies, and advocate for fair and reasonable insurance options for American businesses.?
While the responsibility to act lies with Congress, business owners can influence the outcome by urging their elected representatives to support a CRA resolution.
CIC Services encourages business owners to contact their members of Congress to explain how this rule will impact their businesses, share personal experiences highlighting the real-world consequences of losing access to captive insurance, and engage in advocacy efforts by collaborating with industry groups and staying informed.
