Page:United States Statutes at Large Volume 47 Part 1.djvu/250

 226 72d CONGRESS. SESS. I. CH. 209. JUNE 6, 1932 . INCOME TAX (3) INVESTME NT INCOME. " Investment income " means' the "Investment in- gross amount of income earned during the taxable year from come." interest, dividends and rents, computed as follows : Sources of. To all interest, dividends and rents received during the taxable year, add interest, dividends and rents due and accrued at the end of the taxable yea r, and deduct all interest, divide nds and rents due and accrued at the end of the preceding taxable year ; "Underwriting in- (4) UNDERWRITING INCOME .-" Und erw rit ing income " means the come ." premiums earned on insurance contracts during the taxable year less losses incurred and expenses incurred ; "Premiums earned." (5) PREMIUMS EARNED. -"Premiums earned on insurance con- tracts during the taxable year " means an amount computed as f ollows Computation of. From the amount of gross premiums written on insurance contracts during the taxable year, deduct return premiums and premiums paid for reinsurance. To 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 year ; 'Losse s incurred ." (6) LossEs INCURRED .- " Losses incurred " means losses incurred d uring the taxabl e year on insura nce contracts, computed as fol- lows Computation of. To losses paid during the taxable year, add salvage and reinsur- a nce recoverable outstanding at t he end of the p receding taxable y ear, and deduct salvage and rein surance recover able outstanding at the end of the taxable year . To the result so obtained add all u npaid losses ou tstanding at th e end of the ta xable year and deduct unpaid losses outstanding at the end of the preceding tax- able year ; "E xpen ses incu rre d ." (7) ExPENSES INCURRED." Expenses incurred " mea ns all expenses shown on the annual statement approved by the National C onvention of In surance Commiss ioners, and sha ll be computed as follows : Computation of. To all expenses paid during the taxable year add expenses unpa id at the end of the taxable ye ar and deduct ex penses unpaid at the end of the preceding taxable year . For the purpose of com- puti ng the net incom e subject to th e tax imposed by this section there shall be deducted from expenses incurred as defined in this paragraph all expenses incurred which are not allowed as deduc- tions by subsection (c) of this section . Deductions e u ton allowed. (c) DEDUCTIONS ALLowED.-In computing the net income of an i ( nsurance company subject to the tax imposed by -this section there shall be allowed as deductions Ante, n p. 17p 17 9. enses. (1) All ordinary and' necessary expenses incurred,, as provided in section 23 (a) ; Interest. (2 All interest as provided in section 23 (b) ; Taxes . 3 Taxes as provided in section 23 (c) Los ses . (4 Losses, incurred as defined in, subsection (b) (6) of this section ; - Losses from sajes. (5) Losses sustained during the taxable year from the sale or other disposition of property ; Worthless debts. (6) Bad debts in the nature of agency balances and bills receiv- able as certained to be w orthless and cha rged off within t he taxable year ; Dividends from eor- (7) The amount received as dividends from corporations as orations. provided in section 23(p) ; Exempt interest. (8) The amount of interest earned during the taxable year which Aide. p.178. under sec tion 22(b) (4) i s exempt from th e taxes imposed by this