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USC Title 26 enacted through 2008

§ 806. Small life insurance company deduction

 
(a)
Small life insurance company deduction
 
(1)
In general
 
For purposes of section 804, the small life insurance company deduction for any taxable year is 60 percent of so much of the tentative LICTI for such taxable year as does not exceed $3,000,000.
 
(2)
Phaseout between $3,000,000 and $15,000,000
 
The amount of the small life insurance company deduction determined under paragraph (1) for any taxable year shall be reduced (but not below zero) by 15 percent of so much of the tentative LICTI for such taxable year as exceeds $3,000,000.
 
(3)
Small life insurance company deduction not allowable to company with assets of $500,000,000 or more
 
(A)
In general
 
The small life insurance company deduction shall not be allowed for any taxable year to any life insurance company which, at the close of such taxable year, has assets equal to or greater than $500,000,000.
 
(B)
Assets
 
For purposes of this paragraph, the term "assets" means all assets of the company.
 
(C)
Valuation of assets
 
For purposes of this paragraph, the amount attributable to -
 
(i)
real property and stock shall be the fair market value thereof, and
 
(ii)
any other asset shall be the adjusted basis of such asset for purposes of determining gain on sale or other disposition.
 
(D)
Special rule for interests in partnerships and trusts
 
For purposes of this paragraph -
 
(i)
an interest in a partnership or trust shall not be treated as an asset of the company, but
 
(ii)
the company shall be treated as actually owning its proportionate share of the assets held by the partnership or trust (as the case may be).
 
(b)
Tentative LICTI
 
For purposes of this part -
 
(1)
In general
 
The term "tentative LICTI" means life insurance company taxable income determined without regard to the small life insurance company deduction.
 
(2)
Exclusion of items attributable to noninsurance businesses
 
The amount of the tentative LICTI for any taxable year shall be determined without regard to all items attributable to noninsurance businesses.
 
(3)
Noninsurance business
 
(A)
In general
 
The term "noninsurance business" means any activity which is not an insurance business.
 
(B)
Certain activities treated as insurance businesses
 
For purposes of subparagraph (A), any activity which is not an insurance business shall be treated as an insurance business if -
 
(i)
it is of a type traditionally carried on by life insurance companies for investment purposes, but only if the carrying on of such activity (other than in the case of real estate) does not constitute the active conduct of a trade or business, or
 
(ii)
it involves the performance of administrative services in connection with plans providing life insurance, pension, or accident and health benefits.
 
(C)
Limitation on amount of loss from noninsurance business which may offset income from insurance business
 
In computing the life insurance company taxable income of any life insurance company, any loss from a noninsurance business shall be limited under the principles of section 1503(c).
 
(c)
Special rule for controlled groups
 
(1)
Small life insurance company deduction determined on controlled group basis
 
For purposes of subsection (a) -
 
(A)
all life insurance companies which are members of the same controlled group shall be treated as 1 life insurance company, and
 
(B)
any small life insurance company deduction determined with respect to such group shall be allocated among the life insurance companies which are members of such group in proportion to their respective tentative LICTI's.
 
(2)
Nonlife insurance members included for asset test
 
For purposes of subsection (a)(3), all members of the same controlled group (whether or not life insurance companies) shall be treated as 1 company.
 
(3)
Controlled group
 
For purposes of this subsection, the term "controlled group" means any controlled group of corporations (as defined in section 1563(a)); except that subsections (a)(4) and (b)(2)(D) of section 1563 shall not apply.
 
(4)
Adjustments to prevent excess detriment or benefit
 
Under regulations prescribed by the Secretary, proper adjustments shall be made in the application of this subsection to prevent any excess detriment or benefit (whether from year-to-year or otherwise) arising from the application of this subsection.








Tax Code (Internal Revenue Code) Section Index


U.S. GAAP by Codification Topic
 
105 GAAP Hierarchy
105 GAAP History

205 Presentation of Financial Statements
205-20 Discontinued Operations
210 Balance Sheet
210-20 Offsetting
220 Comprehensive Income
225 Income Statement
225-20 Extraordinary and Unusual Items
230 Statement of Cash Flows
250 Accounting Changes and Error Corrections
260 Earnings per Share
270 Interim Reporting

310 Impairment of a Loan
320 Investment Securities
320 Other-Than-Temporary Impairments, FSP FAS 115-2
320-10-05 Overview of Investments in Other Entities
320-10-35 Reclassification of Investments in Securities
323-10 Equity Method Investments
323-30 Investments in Partnerships and Joint Ventures
325-20 Cost Method Investments
330 Inventory

340-20 Capitalized Advertising Costs
350-20 Goodwill
350-30 Intangibles Other than Goodwill
350-40 Internal-Use Software
350-50 Website Development Costs
360 Property, Plant and Equipment
360-20 Real Estate Sales

410 Asset Retirement and Environmental Obligations
420 Exit or Disposal Cost Obligations
450 Contingencies
450-20 Loss Contingencies
450-30 Gain Contingencies
480 Redeemable Financial Instruments

505-20 Stock Dividends, Stock Splits
505-30 Treasury Stock

605 SEC Staff Accounting Bulletin, Topic 13
605-25 Revenue Recognition - Multiple Element Arrangements

715-30 Defined Benefit Plans - Pension
718 Share-Based Payment
730 Research and Development
730-20 Research and Development Arrangements

805 Business Combinations
810 Consolidation
810 Noncontrolling Interests
810 Consolidation of Variable Interest Entities, SFAS 167

815 Derivatives and Hedging Overview

820 Fair Value Measurements
820 Fair value when the markets are not active, FSP FAS 157-4
825 Fair Value Option

830 Foreign Currency Matters
830-20 Foreign Currency Transactions
830-30 Translation of Financial Statements
835 Interest
835-20 Capitalization of Interest
835-30 Imputation of Interest

840 Leases
840-20 Operating Leases
840-30 Capital Leases
840-40 Sale-Leaseback Transactions
845 Nonmonetary Transactions

855 Subsequent Events
860-20 Sale of Financial Assets, SFAS 166
860-50 Servicing Assets and Liabilities, SFAS 156

985-20 Costs of software to be sold


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