Interim Report to the Congress on Life Insurance Company Taxation

摘要

The Deficit Reduction Act of 1984 (Public Law 98-369) (1984 Act) altered the tax treatment of life insurance companies and products. Congress expressed concern about the amount of taxes paid by life insurance industry and the relative tax burden of mutual life insurance companies and stock life insurance companies (segment balance). The report responds to the congressional mandate for interim reports on these subjects to be performed by the Treasury Department. It evaluates the revenue effect of these tax changes and provides data on taxes paid by the life insurance industry and segment balance. The analysis is based upon data reported to the Treasury Department in a special survey of life insurance companies. Principal findings are: The complete overhaul of the life insurance industry's tax rules in 1984 made estimating effects on the industry and the consequent tax collections extremely uncertain, and 1982 and 1984 Tax Act changes to life insurance company taxation have increased revenues by a smaller amount than predicted.