(Bloomberg) — Hedge fund managers including billionaire John Paulson won't immediately face new limits on their use of insurance in offshore tax havens, after the IRS proposed rules and chose not to make them effective now.
The Internal Revenue Service rules, released on Thursday, will take effect only after the agency takes comments and considers how several important terms will be defined.
The U.S. Treasury Department said in an Aug. 9 letter to then-Senate Finance Committee Chairman Ron Wyden that it was concerned about a "loophole" that allows hedge fund managers to limit their personal income tax bills by routing investments through insurance companies in low-tax jurisdictions.
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