A bill to amend the Internal Revenue Code of 1954 to prevent any life insurance company from taking undue advantage of the fresh-start provisions of the Tax Reform Act of 1984 through changes in business practices after 1983 with respect to policyholder dividends.

Amends the Internal Revenue Code to provide that policyholder dividend amounts that are accelerated and are paid or accrued because of a change in business practices by an insurance company after December 31, 1983, shall not be taken into account as paid or accrued for purposes of the policyholder dividends income tax deduction to the extent that such amounts do not exceed the amounts held as of December 31, 1983, by an insurance company as reserves for dividends to policyholders.

Revises the definition of "statement gain or loss from operations" for purposes of the reduction in certain deductions of mutual life insurance companies.