Page:United States Statutes at Large Volume 98 Part 1.djvu/815

 PUBLIC LAW 98-369—JULY 18, 1984 SEC. 219. CLARIFICATION OF AUTHORITY TO REQUIRE CERTAIN INFORMATION.

Nothing in any provision of law shall be construed to prevent the Secretary of the Treasury or his delegate from requiring (from time to time) life insurance companies to provide such data with respect to taxable years beginning before January 1, 1984, as may be necessary to carry out the provisions of section 809 of such Code (as added by this title).

98 STAT. 767 26 USC 809 note

Ante, p. 733.

Subtitle B—Taxation of Life Insurance Products SEC. 221. DEFINITION OF LIFE INSURANCE CONTRACT.

(a) GENERAL RULE.—Chapter 79 (relating to definitions) is amended by adding at the end thereof the following new section: "SEC. 7702. LIFE INSURANCE CONTRACT DEFINED.

26 USC 7702.

"(a) GENERAL RULE.—For purposes of this title, the term 'life insurance contract' means any contract which is a life insurance contract under the applicable law, but only if such contract— "(1) meets the cash value accumulation test of subsection (b), or "(2)(A) meets the guideline premium requirements of subsection (c), and "(B) falls within the cash value corridor of subsection (d). "(b) CASH VALUE ACCUMULATION TEST FOR SUBSECTION (a)(1).—

"(1) IN GENERAL.—A contract meets the cash value accumulation test of this subsection if, by the terms of the contract, the cash surrender value of such contract may not at any time exceed the net single premium which would have to be paid at such time to fund future benefits under the contract. "(2) RULES FOR APPLYING PARAGRAPH

(D.—Determinations

under paragraph (1) shall be made— "(A) on the basis of interest at the greater of an annual effective rate of 4 percent or the rate or rates guaranteed on issuance of the contract, "(B) on the basis of the rules of subparagraph (B)(i) (and, in the case of qualified additional benefits, subparagraph (B)(ii)) of subsection (c)(3), and "(C) by taking into account under subparagraphs (A) and (C) of subsection (e)(1) only current and future death benefits and qualified additional benefits. "(c) GUIDELINE PREMIUM REQUIREMENTS.—For purposes of this section— "(1) IN GENERAL.—A contract meets the guideline premium requirements of this subsection if the sum of the premiums paid under such contract does not at any time exceed the guideline premium limitation as of such time. "(2) GUIDELINE PREMIUM LIMITATION.—The term 'guideline premium limitation' means, as of any date, the greater of— "(A) the guideline single premium, or "(B) the sum of the guideline level premiums to such date. "(3) GUIDEUNE SINGLE PREMIUM.—

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