--- title: Congress Backs Captives - RMC Group description: A letter signed by 8 members of Congress reiterated the members’ strong support for captives >> learn more about the signed letter image: https://rmcgp.com/hubfs/Imported_Blog_Media/RMC-Blog-Header-8.png --- [ ← Back to Blog ](https://rmcgp.com/blog) # Congress Backs Captives Written By RMC Group Published on: December 27, 2023 **Categories:** Captive Insurance ![Congress Backs Captives](https://rmcgp.com/hubfs/Imported_Blog_Media/RMC-Blog-Header-8.png) A letter to IRS Commissioner Daniel Werfel signed by eight members of the House Ways and Means Committee was released to the public on December 20, 2023.  The letter “reiterated the members’ strong support for small captive insurance” companies and criticized the campaign being waged by the IRS to put legitimate captives out of business. The letter described the reason why Congress added section 831(b) captives to the Internal Revenue Code: Section 831(b) ensures that small businesses can accumulate reserves sufficient to cover risks that they cannot insure, or cannot afford to insure, via traditional commercial insurance. This includes rare, but potentially catastrophic risks. It provides competition and choice to small businesses located in underserved and rural communities, which is critical as commercial property and casualty insurers are pulling out of markets and dramatically increasing premiums and/or deductibles. In addition, it confirmed Congress’ support for small captive insurance companies: Congress most recently signaled its intent that the benefits of captive insurance remain available to small and medium U.S. businesses when it enacted the Protecting Americans From Tax Hikes (PATH) Act in 2015. That statute nearly doubled the maximum annual premium income that an electing insurance company may have, indexed that new premium limitation amount to inflation, and incorporated provisions designed to limit areas of suspected abuse relating to estate planning. Finally, the letter warned [Commissioner Werfel](https://www.irs.gov/about-irs/commissioner-danny-werfel) that the actions of the IRS posed a threat to the American economy: Treasury and the IRS are harming the American economy by their misguided effort to eradicate small captive insurance. This letter is good news for the captive insurance industry.  You can find [a link to the letter here](https://rmcgp.com/wp-content/uploads/2023/12/2023-36859_TNTIRSDocs_Van_Duyne_letter_to_Werfel_Dec_6-3-1.pdf). RMC Group will continue to keep you updated on developments that matter to the captive insurance industry. 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