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KSM Blog | Katz, Sapper & Miller CPA

Are You Optimizing Your Dealership’s Insurance Programs?

Posted 7:46 PM by

A Dealer’s Guide to Insurance Programs discusses an often overlooked area of profit potential: a dealership’s insurance programs. In today’s economy, there are many complex arrangements available to dealerships, and it can be tough to navigate the research process in order to select the right program. That’s where Katz, Sapper & Miller can help.  

Created by KSM’s Dealership and Buy Here-Pay Here Services Groups, the guide shares insights on how to apply the tax advantages of Section 831(b) of the U.S. Tax Code, as well as the Protecting Americans from Tax Hikes Act of 2015 (PATH Act).

Using everyday examples, the guide touches on how a few potential profit-boosting options might apply and their impact on maximizing profits. It also examines the following topics:

  • Commission-based Programs compares the tax advantages and disadvantages of Straight Commission programs versus Retro Commission programs.
  • Benefits of Creating a Small Reinsurance Company discusses the two options for setting up an entity that qualifies for the 813(b) election: a dealer-owned warranty company (DOWC) and an offshore reinsurance company.
  • For dealerships that do not qualify for the 831(b) election, the non-controlled foreign corporation (NCFC) may offer some tax advantages.

There are many factors to consider when deciding which option is best for your dealership. Download the guide to review some of your options, and please do not hesitate to contact us with further questions. 

About the Author

Kevin Sullivan is a partner in Katz, Sapper & Miller’s Tax Services Group and a member of the firm's Dealership and Buy Here-Pay Here Services Groups. In charge of the firm’s insurance tax practices, Kevin is experienced in tax accounting methods. Connect with him on LinkedIn

 

About the Author
Jeff Taylor is the partner-in-charge of the firm’s Dealership and Buy Here-Pay Here Services Groups. Jeff is experienced in the areas of mergers and acquisitions, cash management, financing, forecasts and projections, tax planning, and business structuring. Connect with him on LinkedIn

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