Page:United States Statutes at Large Volume 98 Part 1.djvu/768

 98 STAT. 720

PUBLIC LAW 98-369—JULY 18, 1984 Sec. 817. Treatment of variable contracts. Sec. 818. Other definitions and special rules.

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Subtitle A—Taxation of Life Insurance Companies PART I—AMENDMENT OF SUBCHAPTER L SEC. 211. AMENDMENT OF SUBCHAPTER L.

(a) GENERAL RULE.—Part I of subchapter L of chapter 1 is amended to read as follows: "PART I—LIFE INSURANCE COMPANIES

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"Subpart "Subpart "Subpart "Subpart "Subpart

A. Tax imposed. B. Life insurance gross income. C. Life insurance deductions. D. Accounting, allocation, and foreign provisions. E. Definitions and special rules.

"Subpart A—Tax Imposed "Sec. 801. Tax imposed. 26 USC 801.

"SEC. 801. TAX IMPOSED. "(a) TAX IMPOSED.—

"(1) IN GENERAL.—A tax is hereby imposed for each taxable year on the life insurance company taxable income of every life insurance company. Such tax shall consist of a tax computed as provided in section 11 as though the life insurance company taxable income were the taxable income referred to in section 11"(2) ALTERNATIVE TAX IN CASE OP CAPITAL GAINS.—

"(A) IN GENERAL.—If a life insurance company has a net capital gain for the taxable year, then (in lieu of the tax imposed by paragraph (1)), there is hereby imposed a tax (if such tax is less than the tax imposed by paragraph (1)). "(B) AMOUNT OF TAX.—The amount of the tax imposed by

this paragraph shall be the sum of— "(i) a partial tax, computed as provided by paragraph (1), on the life insurance company taxable income reduced by the amount of the net capital gain, and "(ii) an amount determined as provided in section 1201(a) on such net capital gain. "(C) N E T CAPITAL GAIN NOT TAKEN INTO ACCOUNT IN DETERMINING SPECIAL U F E INSURANCE COMPANY DEDUCTION AND SMALL U F E INSURANCE COMPANY DEDUCTION.—For p u r -

Post, p. 722.

poses of subparagraph (B)(i), the amounts allowable as deductions under paragraphs (2) and (3) of section 804 shall be determined by reducing the tentative LICTI by the amount of the net capital gain (determined without regard to items attributable to noninsurance businesses). "(b) LIFE INSURANCE COMPANY TAXABLE INCOME.—For purposes of this part, the term 'life insurance company taxable income' means— "(1) life insurance gross income, reduced by "(2) life insurance deductions.

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