Page 101 - Tax Reform

PUBLIC LAW 115–97—DEC. 22, 2017 131 STAT. 2151

(2) Section 6047 is amended— 26 USC 6047.
(A) by redesignating subsection (g) as subsection (h),
(B) by inserting after subsection (f) the following new
subsection:
‘‘(g) INFORMATION RELATING TO LIFE INSURANCE CONTRACT
TRANSACTIONS.—This section shall not apply to any information
which is required to be reported under section 6050Y.’’, and
(C) by adding at the end of subsection (h), as so redesig-
nated, the following new paragraph:
‘‘(4) For provisions requiring reporting of information
relating to certain life insurance contract transactions, see sec-
tion 6050Y.’’.
(d) EFFECTIVE DATE.—The amendments made by this section 26 USC 6047
shall apply to— note.
(1) reportable policy sales (as defined in section 6050Y(d)(2)
of the Internal Revenue Code of 1986 (as added by subsection
(a)) after December 31, 2017, and
(2) reportable death benefits (as defined in section
6050Y(d)(4) of such Code (as added by subsection (a)) paid
after December 31, 2017.

SEC. 13521. CLARIFICATION OF TAX BASIS OF LIFE INSURANCE CON-
TRACTS.
(a) CLARIFICATION WITH RESPECT TO ADJUSTMENTS.—Para-
graph (1) of section 1016(a) is amended by striking subparagraph
(A) and all that follows and inserting the following:
‘‘(A) for—
‘‘(i) taxes or other carrying charges described in
section 266; or
‘‘(ii) expenditures described in section 173 (relating
to circulation expenditures),
for which deductions have been taken by the taxpayer
in determining taxable income for the taxable year or prior
taxable years; or
‘‘(B) for mortality, expense, or other reasonable charges
incurred under an annuity or life insurance contract;’’.
(b) EFFECTIVE DATE.—The amendment made by this section 26 USC 1016
shall apply to transactions entered into after August 25, 2009. note.
SEC. 13522. EXCEPTION TO TRANSFER FOR VALUABLE CONSIDER-
ATION RULES.
(a) IN GENERAL.—Subsection (a) of section 101 is amended
by inserting after paragraph (2) the following new paragraph:
‘‘(3) EXCEPTION TO VALUABLE CONSIDERATION RULES FOR
COMMERCIAL TRANSFERS.—
‘‘(A) IN GENERAL.—The second sentence of paragraph
(2) shall not apply in the case of a transfer of a life
insurance contract, or any interest therein, which is a
reportable policy sale.
‘‘(B) REPORTABLE POLICY SALE.—For purposes of this
paragraph, the term ‘reportable policy sale’ means the
acquisition of an interest in a life insurance contract,
directly or indirectly, if the acquirer has no substantial
family, business, or financial relationship with the insured
apart from the acquirer’s interest in such life insurance
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contract. For purposes of the preceding sentence, the term
‘indirectly’ applies to the acquisition of an interest in a