'IRS Overreach Rejected in Validus Decision' by Mark R. Goodman, Freeborn & Peters LLP

[Editor's note: Mark R. Goodman is a Partner in Freeborn & Peters LLP's Corporate Practice Group. He has three decades of experience advising the insurance industry on corporate, regulatory and transactional matters. Copyright 2014, Mark R. Goodman]

A recent court decision rejected the IRS’s novel “cascading” excise tax theory with respect to reinsurance transactions between two non-U.S. companies. Validus Reinsurance Ltd. v. United States of America, No. 13-0109 (D. D.C.). The implications of this decision are relevant to U.S. ceding companies and to their reinsurers, both domestic and foreign. If the decision stands, it could even have an effect on …