118
26 USC 611.
26 USC 1231.
248? "^*^ 172,241-
PUBLIC LAW 86-69-JUNE 25, 1959
[73 S T A T.
"(4) DEPLETION.—The deduction allowed by section 611 (relating to depletion). " (5) TRADE OR BUSINESS DEDUCTIONS.—The deductions allowed by this subtitle (without regard to this part) which are attributable to any trade or business (other than an insurance business) carried on by the life insurance company, or by a partnership of which the life insurance company is a partner; except that in computing the deduction under this paragraph— " (A) There shall be excluded losses— " (i) from (or considered as from) sales or exchanges of capital assets, "(ii) from sales or exchanges of property used in the trade or business (as defined in section 1231(b)), and "(iii) from the compulsory or involuntary conversion (as a result of destruction, in whole or in part, theft or seizure, or an exercise of the power of requisition or condemnation or the threat or imminence thereof) of property used in the trade or business (as so defined). " (B) Any item, to the extent attributable to the carrying on of the insurance business, shall not be taken into account. " (C) The deduction for net operating losses provided in section 172, and the special deductions for corporations provided in part VIII of subchapter B, shall not be allowed. "SEC. 805. POLICY AND OTHER CONTRACT LIABILITY REQUIREMENTS. " (a) IN GENERAL.—For purposes of this part, the term, 'policy and other contract liability requirements' means, for any taxable year, the sum of— "(1) the adjusted life insurance reserves, multiplied by the adjusted reserves rate, "(2) the mean of the pension plan reserves at the beginning and end of the taxable year, multiplied by the current earnings rate, and "(3) the interest paid. " (b) ADJUSTED RESERVES RATE AND EARNINGS RATES.— "(1) ADJUSTED RESERVES RATE.—For purposes of this part,
the adjusted reserves rate for any taxable year is the average earnings rate or, if lower, the current earnings rate. "(2) CURRENT EARNINGS RATE.—For purposes of this part, the current earnings rate for any taxable year is the amount determined by dividing— " (A) the taxpayer's investment yield for such taxable year, by " (B) the mean of the taxpayer's assets at the beginning and end of the taxable year. " (3) AVERAGE EARNINGS RATE.—
" (A) IN GENERAL.—For purposes of this part, the average earnings rate for any taxable year is the average of the current earnings rates for such taxable year and for each of the 4 taxable years immediately preceding such taxable year (excluding any of such 4 taxable years for which the taxpayer was not an insurance company). " (B) SPECIAL RULES.—For purposes of subparagraph
(A)26 USC 381.
" (i) the current earnings rate for any taxable year beginning before January 1, 1958, shall be determined as if this part (as in effect for 1958) and section 381 (c) (22) applied to such taxable year, and
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