Page:United States Statutes at Large Volume 98 Part 1.djvu/791

 PUBLIC LAW 98-369—JULY 18, 1984

98 STAT. 743

"(e) DIVIDENDS FROM CERTAIN SUBSIDIARIES NOT INCLUDED IN GROSS INVESTMENT INCOME.—For purposes of this section, the term

'gross investment income' shall not include any dividend received by the life insurance company which is a 100-percent dividend (as defined in section 805(a)(4)(C)). Such term also shall not include any dividend described in section 805(a)(4)(D) (relating to certain dividends in the case of foreign corporations). "(f) No DOUBLE COUNTING.—Under regulations, proper adjustments shall be made in the application of this section to prevent an item from being counted more than once. "SEC 813. FOREIGN LIFE INSURANCE COMPANIES.

Ante, p. 722..

26 USC 813.

"(a) ADJUSTMENT WHERE SURPLUS HELD IN THE UNITED STATES IS LESS THAN SPECIFIED MINIMUM.—

"(1) IN GENERAL.—In the case of any foreign company taxable under this part, if— "(A) the required surplus determined under paragraph (2), exceeds "(B) the surplus held in the United States, then its income effectively connected with the conduct of an insurance business within the United States shall be increased by an amount determined by multiplying such excess by such company's current investment yield. "(2) REQUIRED SURPLUS.—For purposes of this subsection— "(A) IN GENERAL.—The term 'required surplus' means the amount determined by multiplying the taxpayer's total insurance liabilities on United States business by a percentage for the taxable year determined and proclaimed by the Secretary under subparagraph (B). "(B) DETERMINATION OF PERCENTAGE.—The percentage de•mmk termined and proclaimed by the Secretary under this subparagraph shall be based on such data with respect to domestic life insurance companies for the preceding taxable year as the Secretary considers representative. Such perI,^ centage shall be computed on the basis of a ratio the ^" numerator of which is the excess of the assets over the total insurance liabilities, and the denominator of which is the j^ total insurance liabilities. "(3) CURRENT INVESTMENT YIELD.—For purposes of this subsection— "(A) IN GENERAL.—The term 'current investment yield' [means the percent obtained by dividing— "(i) the net investment income on assets held in the ^ United States, by "(ii) the mean of the assets held in the United States during the taxable year.

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"(B) DETERMINATIONS BASED ON AMOUNT SET FORTH IN THE

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ANNUAL STATEMENT.—Except as otherwise provided in regulations, determinations under subparagraph (A) shall be made on the basis of the amounts required to be set forth on the annual statement approved by the National Association of Insurance Commissioners. "(4) OTHER DEFINITIONS.—For purposes of this subsection— "(A) SURPLUS HELD IN THE UNITED STATES.—The surplus

held in the United States is the excess of the assets (determined under section 8060t)X3XC)) held in the United States

Ante, p. 724.

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