26 U.S.C. § 594 — Alternative tax for mutual savings banks conducting life insurance business

submitted 72 years ago by ch. 736 to r/title-26-INTERNAL-REVENUE-CODE · 217 words · no verdicts yet

in plain englishAI-generated · not legal advice

A qualifying mutual savings bank that conducts life insurance in a separate department pays a combined alternative tax. One part uses ordinary corporate rules for other income, and the other uses life-insurance-company rules; the alternative applies only if the department would qualify as a life insurance company.

(a) Alternative tax. A mutual savings bank without share capital that State law allows to issue life-insurance contracts, and that conducts life-insurance business in a separate department with separate accounts, owes instead of the section 11 tax a tax equal to two partial taxes: (1) a tax on income excluding income and deductions assigned to the life-insurance department, computed as if this section had not been enacted; and (2) a tax on the department’s income, excluding items not assigned to it, computed under subchapter L for life insurance companies. (b) Limitation. Subsection (a) applies only if the department would qualify as a life insurance company under section 816 if treated as a separate corporation.

the actual law source: uscode.house.gov ↗public domain

(a) Alternative tax

In the case of a mutual savings bank not having capital stock represented by shares, authorized under State law to engage in the business of issuing life insurance contracts, and which conducts a life insurance business in a separate department the accounts of which are maintained separately from the other accounts of the mutual savings bank, there shall be imposed in lieu of the tax imposed by section 11, a tax consisting of the sum of the partial taxes determined under paragraphs (1) and (2):

(1)

A partial tax computed on the taxable income determined without regard to any items of gross income or deductions properly allocable to the business of the life insurance department, at the rates and in the manner as if this section had not been enacted; and

(2)

a partial tax computed on the income of the life insurance department determined without regard to any items of gross income or deductions not properly allocable to such department, at the rates and in the manner provided in subchapter L (sec. 801 and following) with respect to life insurance companies.

(b) Limitations of section

Subsection (a) shall apply only if the life insurance department would, if it were treated as a separate corporation, qualify as a life insurance company under section 816.

Source credit: (Aug. 16, 1954, ch. 736, 68A Stat. 205; Mar. 13, 1956, ch. 83, § 5(3), 70 Stat. 49; Pub. L. 98–369, div. A, title II, § 211(b)(8), July 18, 1984, 98 Stat. 755; Pub. L. 115–97, title I, § 13001(b)(2)(E), Dec. 22, 2017, 131 Stat. 2096.)

history & why it existsrecord from the source credit

1954Enacted · Act of Aug. 16, 1954, ch. 736
1956Amended · Act of Mar. 13, 1956, ch. 83 · 70 Stat. 49
1984Amended · Pub. L. 98-369 · 98 Stat. 755
2017Amended · Pub. L. 115-97 · 131 Stat. 2096

A history note hasn’t been published yet. The record shows enactment by ch. 736 on 1954-08-16.

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