Page 98 - Tax Reform

131 STAT. 2148 PUBLIC LAW 115–97—DEC. 22, 2017

(i) If the amount determined under subparagraph
(A)(i) exceeds the amount determined under subpara-
graph (A)(ii), 1/8 of such excess shall be taken into
account, for each of the 8 succeeding taxable years,
as a deduction under section 805(a)(2) or 832(c)(4) of
such Code, as applicable.
(ii) If the amount determined under subparagraph
(A)(ii) exceeds the amount determined under subpara-
graph (A)(i), 1/8 of such excess shall be included in
gross income, for each of the 8 succeeding taxable
years, under section 803(a)(2) or 832(b)(1)(C) of such
Code, as applicable.
SEC. 13518. MODIFICATION OF RULES FOR LIFE INSURANCE PRORA-
TION FOR PURPOSES OF DETERMINING THE DIVIDENDS
RECEIVED DEDUCTION.
26 USC 812. (a) IN GENERAL.—Section 812 is amended to read as follows:
‘‘SEC. 812. DEFINITION OF COMPANY’S SHARE AND POLICYHOLDER’S
SHARE.
‘‘(a) COMPANY’S SHARE.—For purposes of section 805(a)(4), the
term ‘company’s share’ means, with respect to any taxable year
beginning after December 31, 2017, 70 percent.
‘‘(b) POLICYHOLDER’S SHARE.—For purposes of section 807, the
term ‘policyholder’s share’ means, with respect to any taxable year
beginning after December 31, 2017, 30 percent.’’.
(b) CONFORMING AMENDMENT.—Section 817A(e)(2) is amended
by striking ‘‘, 807(d)(2)(B), and 812’’ and inserting ‘‘and 807(d)(2)(B)’’.
26 USC 812 note. (c) EFFECTIVE DATE.—The amendments made by this section
shall apply to taxable years beginning after December 31, 2017.
SEC. 13519. CAPITALIZATION OF CERTAIN POLICY ACQUISITION
EXPENSES.
(a) IN GENERAL.—
(1) Section 848(a)(2) is amended by striking ‘‘120-month’’
and inserting ‘‘180-month’’.
(2) Section 848(c)(1) is amended by striking ‘‘1.75 percent’’
and inserting ‘‘2.09 percent’’.
(3) Section 848(c)(2) is amended by striking ‘‘2.05 percent’’
and inserting ‘‘2.45 percent’’.
(4) Section 848(c)(3) is amended by striking ‘‘7.7 percent’’
and inserting ‘‘9.2 percent’’.
(b) CONFORMING AMENDMENTS.—Section 848(b)(1) is amended
by striking ‘‘120-month’’ and inserting ‘‘180-month’’.
26 USC 848 note. (c) EFFECTIVE DATE.—
(1) IN GENERAL.—The amendments made by this section
shall apply to net premiums for taxable years beginning after
December 31, 2017.
(2) TRANSITION RULE.—Specified policy acquisition expenses
first required to be capitalized in a taxable year beginning
before January 1, 2018, will continue to be allowed as a deduc-
tion ratably over the 120-month period beginning with the
first month in the second half of such taxable year.
SEC. 13520. TAX REPORTING FOR LIFE SETTLEMENT TRANSACTIONS.
(a) IN GENERAL.—Subpart B of part III of subchapter A of
dkrause on DSKBC28HB2PROD with PUBLAWS VerDate Sep 11 2014 10:09 Oct 18, 2018 Jkt 079139 PO 00097 Frm 00096 Fmt 6580 Sfmt 6581 E:\PUBLAW\PUBL097.115 PUBL097
chapter 61, as amended by section 13306, is amended by adding
at the end the following new section: