IRS releases 2016 loss reserve and salvage discount factors for insurers
Article

IRS releases 2016 loss reserve and salvage discount factors for insurers

In Internal Revenue Bulletin 2016-51, the Internal Revenue Service published Rev. Proc. 2016-58 (loss payment patterns and discount factors) and Rev. Proc. 2016-59 (salvage discount factors) for 2016.

Revenue Procedure 2016-58

Rev. Proc. 2016-58, under Internal Revenue Code (IRC) section 846, establishes the loss payment patterns and discount factors to be used for the 2016 accident year. Insurance companies should use these factors for computing discounted unpaid losses for each property and casualty line of business.

Revenue Procedure 2016-59

Rev. Proc. 2016-59, under IRC section 832, establishes the salvage discount factors to be used for the 2016 accident year. These factors should be used for computing discounted estimated salvage recoverable for each property and casualty line of business.

For more information on this topic, or to learn how Baker Tilly insurance specialists can help, contact our team.

The information provided here is of a general nature and is not intended to address the specific circumstances of any individual or entity. In specific circumstances, the services of a professional should be sought. Tax information, if any, contained in this communication was not intended or written to be used by any person for the purpose of avoiding penalties, nor should such information be construed as an opinion upon which any person may rely.  The intended recipients of this communication and any attachments are not subject to any limitation on the disclosure of the tax treatment or tax structure of any transaction or matter that is the subject of this communication and any attachments.

Related sections

GASB issues guidance for recording asset retirement obligations
Next up

GASB issues guidance for recording asset retirement obligations