Special Purpose Entities

Federal and state tax codes provide complex rules for the taxation of various legal or tax-specific entities. Knowing how each one operates, why it exists and how the tax laws incent one structure versus another is critical to the performance and success of your business. At PKM, we can help you evaluate alternative structures to successfully align your overall financial goals with a tax-incented design.

  • Investment Subsidiaries:
    Many states have favorable rules for entities that are passive investment entities, or impose no state tax at all. These tax jurisdictions can provide significant incentive to locate and operate strategic business functions to take advantage of these state tax laws.
  • Captive Insurance Companies:
    We not only understand the tax implications of captive insurance, but even more so, the importance of risk management, active board participation, and the statutory and regulatory framework in which captive insurance companies must abide.
  • Real Estate Investment Trust (REIT):
    This tax structure can allow a company to carve out investments in qualifying real estate assets and avoid corporate level taxation if structured appropriately. There are state and potential federal tax benefits to this entity that can be explored for companies with the right corporate makeup.