Benjamin Silver (Bar Ilan University, Israel), The Tax Insurance Trap, 2026 Wis. L. Rev. 371 (reviewed by Sloan Speck here):
Read moreConventional wisdom holds that tax uncertainty is an unavoidable consequence of our tax law’s complexity. On this view, tax insurance—a financial product allowing taxpayers to shift tax risk to an insurer for a fee—is merely a hedge against the IRS’s potential disagreement with any given tax position. With this understanding in mind, some commentators have proposed imposing restrictions on tax insurance so that the IRS, not taxpayers, can harness its full potential.
This Article offers a different account of tax uncertainty and tax insurance. It argues that persistent tax law uncertainty is not a brute fact but a policy choice. In contrast to general principles of administrative law, the Anti-Injunction Act bars pre-enforcement judicial review for taxpayers, forcing them to transact first and litigate later. Thus, while substantive complexity might create tax uncertainty, that uncertainty persists because of procedure. Viewed in this light, tax insurance functions as a synthetic pre-enforcement challenge, enabling taxpayers to resolve tax risk reliably.
