Opinion
15581-18
04-08-2024
DESMOND E. MCGUIRE & CORY LYNNE BRAME, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Ronald L. Buch, Judge
On March 13, 2024, the Commissioner filed a Motion for Leave to File First Amendment to Answer and lodged the First Amendment to Answer. The Motion reports that the Commissioner is unaware whether petitioners object. We will order a response to the Commissioner's motion.
We will also order the parties to file separate status reports. Papers previously filed in this case have characterized this case as involving what is sometimes referred to as "microcaptive insurance." A common issue in microcaptive insurance cases is whether the purported insurer adequately distributes risk or otherwise acts in a manner consistent with how an insurer commonly would act. To date, the Tax Court has decided at least seven microcaptive insurance cases. In each of these cases, we held that a microcaptive insurer does not provide insurance if it fails to adequately distribute risk or does not otherwise act as an insurer. See Avrahami v. Commissioner, 149 T.C. 144 (2017); Reserve Mechanical Corp. v. Commissioner, T.C. Memo. 2018-86, aff'd, 34 F.4th 881 (10th Cir. 2022); Syzygy Insurance Co., Inc. v. Commissioner, T.C. Memo. 2019-34; Caylor Land & Development, Inc. v. Commissioner, T.C. Memo. 2021- 30; Keating v. Commissioner, T.C. Memo. 2024-2; Swift v. Commissioner, T.C. Memo. 2024-13; and Patel v. Commissioner, T.C. Memo. 2024-34. To assist the Court in better managing its workload, the Court would benefit from understanding the parties' positions as to (1) how these cases differ factually from those that Court has previously decided and (2) what legal issues these cases present that the Court has not previously decided. To that end, it is
ORDERED that the parties shall file separate status reports, each not exceeding 10 pages, by April 26, 2024, identifying any material factual or legal differences between these cases and those already decided by the Court. It is further
ORDERED that petitioners shall file a response to the Commissioner's Motion for Leave to File First Amendment to Answer by April 17, 2024.