Life Insurance Tax Simplification Act of 2003

Life Insurance Tax Simplification Act of 2003 - Amends the Internal Revenue Code to repeal provisions: (1) providing for the reduction in certain deductions of mutual life insurance companies; and (2) relating to distributions to shareholders from pre-1984 policyholders surplus accounts.

[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 808 Introduced in House (IH)]







108th CONGRESS
  1st Session
                                H. R. 808

  To amend the Internal Revenue Code of 1986 to repeal the provision 
taxing policyholder dividends of mutual life insurance companies and to 
          repeal the policyholders surplus account provisions.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           February 13, 2003

Mr. Houghton (for himself, Mr. Neal of Massachusetts, Mr. Kleczka, Mr. 
 Crane, Mr. Becerra, Mr. Herger, Mr. Rangel, Mr. McInnis, Mr. Tanner, 
   Mr. Brady of Texas, Mrs. Johnson of Connecticut, Mr. Pomeroy, Mr. 
  Ramstad, and Mr. Ryan of Wisconsin) introduced the following bill; 
         which was referred to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
  To amend the Internal Revenue Code of 1986 to repeal the provision 
taxing policyholder dividends of mutual life insurance companies and to 
          repeal the policyholders surplus account provisions.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Life Insurance Tax Simplification 
Act of 2003''.

SEC. 2. REPEAL OF REDUCTION OF DEDUCTIONS FOR MUTUAL LIFE INSURANCE 
              COMPANIES.

    (a) In General.--Section 809 of the Internal Revenue Code of 1986 
(relating to reductions in certain deduction of mutual life insurance 
companies) is hereby repealed.
    (b) Conforming Amendments.--
            (1) Subsections (a)(2)(B) and (b)(1)(B) of section 807 of 
        such Code are each amended by striking ``the sum of (i)'' and 
        by striking ``plus (ii) any excess described in section 
        809(a)(2) for the taxable year,''.
            (2)(A) The last sentence of section 807(d)(1) of such Code 
        is amended by striking ``section 809(b)(4)(B)'' and inserting 
        ``paragraph (6)''.
            (B) Subsection (d) of section 807 of such Code is amended 
        by adding at the end the following new paragraph:
            ``(6) Statutory reserves.--The term `statutory reserves' 
        means the aggregate amount set forth in the annual statement 
        with respect to items described in section 807(c). Such term 
        shall not include any reserve attributable to a deferred and 
        uncollected premium if the establishment of such reserve is not 
        permitted under section 811(c).''
            (3) Subsection (c) of section 808 of such Code is amended 
        to read as follows:
    ``(c) Amount of Deduction.--The deduction for policyholder 
dividends for any taxable year shall be an amount equal to the 
policyholder dividends paid or accrued during the taxable year.''
            (4) Subparagraph (A) of section 812(b)(3) of such Code is 
        amended by striking ``sections 808 and 809'' and inserting 
        ``section 808''.
            (5) Subsection (c) of section 817 of such Code is amended 
        by striking ``(other than section 809)''.
            (6) Subsection (c) of section 842 of such Code is amended 
        by striking paragraph (3) and by redesignating paragraph (4) as 
        paragraph (3).
            (7) The table of sections for subpart C of part I of 
        subchapter L of chapter 1 of such Code is amended by striking 
        the item relating to section 809.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2003.

SEC. 3. REPEAL OF POLICYHOLDERS SURPLUS ACCOUNT PROVISIONS.

    (a) In General.--Section 815 of the Internal Revenue Code of 1986 
(relating to distributions to shareholders from pre-1984 policyholders 
surplus account) is hereby repealed.
    (b) Conforming Amendments.--
            (1) Section 801 of such Code is amended by striking 
        subsection (c).
            (2) The table of sections for subpart D of part I of 
        subchapter L of chapter 1 of such Code is amended by striking 
        the item relating to section 815.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2002.
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