19 June 2023Analysis

Delaware DOI has appeal for IRS rule rehearing denied

The Delaware Department of Insurance (DDOI) has had its request for a rehearing of its case against the Internal Revenue Service (IRS) turned down by the US Court of Appeals for the Third Circuit.

In April the Court ruled that Delaware insurance regulators can not rely on state law preemption to avoid enforcement of IRS summonses seeking their communications with microcaptive companies and managers.

The DDOI placed an appeal for a rehearing of its case on June 5, which the Court has denied.

The case pitted Delaware's authority to protect corporate privacy against the power of the IRS to enforce the tax laws of the United States.