Page:United States Statutes at Large Volume 42 Part 1.djvu/291

 SIXTYYSEVENTH CONGRESS. Sess. I. C11. 136. 1921. 263 (2) In the case of such a forei insurance com an the same er- ‘"F°“E “"· - centage of its net income from gblurces within thi; Uriiited State}; as Foreign mmpamm is imposed upon the net income of other corporations by section 230. _ b (bgi In the case of an insurance company sub ject to the tax imposed Mming °mmS` y t s sec ron- U _ H (1) The term "gross income" means the combined gross amount, GmSsm°°m€` earned during the taxable year, from investment income and from underwriting income as provided in this subdivision, computed on the basis of the underwmtingl and investment exhibit of the annual statement approved by the ational Convention of Insurance Commissioners; _" _ n (2) The term “net income" means the gross income as defined in mt m°°m°` paragraph (1) of this subdivision less the deductions allowed by section 247; U _ (3) The term “investment income" means the gross amount of w¤i§iX°stm°°t m` income earned élurigguthe taxable year from interest, dividends and rents, com ute as o ows: To all i;1i)terest, dividends and rents received during the taxable S°ur°°s °" year, add interest, dividends and rents due and accrued at the end of the taxable year, and deduct all interest, dividends and rents due and accrued at the end of the preceding taxable year; H _ _ _ (4) The term " underwriting income" means the premiums earned c,,mE¥l°°"'“""g "" on insurance contracts during the taxable year less losses incurred and ex enses incurred; _ (5) The term " premiums earned on insurance contracts during the c,,£$`f“s °””°d °“ taxable year" means an amount computed as follows: From the amount of gross premiums written on insurance contracts °°mP“¤**i°¤ °'- during the taxable ear, deduct return premiums and premiums paid for reinsurance. Tl; the result so obtained add unearned premiums on outstanding business at the end of the preceding taxable year and deduct unearned premiums on outstanding business at the end of the taxable ear· (6) Tlire term "losses incurred" means losses incurred during the "L°S“"°*“°“"°"·" taxable year on insurance contracts, computed as follows: To losses paid during the taxable year, add salvage and reinsurance °°‘°P“'·°“°“ °’· recoverable outstanding at the end of the preceding taxable {ear, and deduct salvage and reinsurance recoverab e outstanding at the end of the taxable year. To the result so obtained add all impaid losses outstanding at the end of the taxable year and deduct unpaid losses outstanding at the end of the preceding taxable year; U (7) The term "expenses incurred" means all eiépenses shown on  *“‘ the annual statement approved by the National onvention of Insurance Oommissioners, and shall e computed as follows: _ _ To all expenses paid during the taxable year add expenses unpaid C°‘“P“‘“‘°“°‘· at the end of the taxable year and deduct expenses unpaid at the end of the preceding taxable year; For the purpose of computing the net income subject to the tax 1m(posed by this section there shall be deducted from expenses incurre as defined in this paragraph all. ex enses incurred which are not allowed as deductions by section 247. _ gmc. 247. (a) That in computing the net income of an insurance §°;*£1°g’§§;ms {__, gplmpany splbglect to the tax imposed by section 246 there shall be lvwedowed as e uctions: _ (1) All ordinary  necessary expenses incurred, as provided in °“‘““¤ *`~‘P°'“°“- paragrgph (1) of subdivision (a) of section 234; _ _ _ mm t (2) 1 interest as provnded in paragraph (2) of subdmswn (rn) of “· section 234· ° _ _ _ (3) Taxes as provided in paragraph (3) of subdivision (a) of T°x“‘ Section 234; _ (4) Losses incurred; Mm