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26 U.S.C. § 891 — Doubling of rates of tax on citizens and corporations of certain foreign countries
Federal law — U.S. Code and appendices · legal_authorities
Whenever the President finds that, under the laws of any foreign country, citizens or corporations of the United States are being subjected to discriminatory or extraterritorial taxes, the President shall so proclaim and the rates of tax imposed by sections 1, 3, 11, 801, 831, 852, 871, and 881 shall, for the taxable year during which such proclamation is made and for each taxable year thereafter, be doubled in the case of each citizen and corporation of such foreign country; but the tax at such doubled rate shall be considered as imposed by such sections as the case may be. In no case shall this section operate to increase the taxes imposed by such sections (computed without regard to this section) to an amount in excess of 80 percent of the taxable income of the taxpayer (computed without regard to the deductions allowable under section 151 and under part VIII of subchapter B). Whenever the President finds that the laws of any foreign country with respect to which the President has made a proclamation under the preceding provisions of this section have been modified so that discriminatory and extraterritorial taxes applicable to citizens and corporations of the United States have been removed, he shall so proclaim, and the provisions of this section providing for doubled rates of tax shall not apply to any citizen or corporation of such foreign country with respect to any taxable year beginning after such proclamation is made.
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Source file: Laws/federal/codes/united-states-code/title-26/section-891-doubling-of-rates-of-tax-on-citizens-and-corporations-of-certain-foreign--49659f7764.md
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Source location: Title 26, Chapter 1, § 891; chapter-001-normal-taxes-and-surtaxes.md
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Whenever the President finds that, under the laws of any foreign country, citizens or corporations of the United States are being subjected to discriminatory or extraterritorial taxes, the President shall so proclaim and the rates of tax imposed by sections 1, 3, 11, 801, 831, 852, 871, and 881 shall, for the taxable year during which such proclamation is made and for each taxable year thereafter, be doubled in the case of each citizen and corporation of such foreign country; but the tax at such doubled rate shall be considered as imposed by such sections as the case may be. In no case shall this section operate to increase the taxes imposed by such sections (computed without regard to this section) to an amount in excess of 80 percent of the taxable income of the taxpayer (computed without regard to the deductions allowable under section 151 and under part VIII of subchapter B). Whenever the President finds that the laws of any foreign country with respect to which the President has made a proclamation under the preceding provisions of this section have been modified so that discriminatory and extraterritorial taxes applicable to citizens and corporations of the United States have been removed, he shall so proclaim, and the provisions of this section providing for doubled rates of tax shall not apply to any citizen or corporation of such foreign country with respect to any taxable year beginning after such proclamation is made.
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Tax imposed** A tax is hereby imposed for each taxable year on the life insurance company taxable income of every life insurance company. Such tax shall consist of a tax computed as provided in section 11 as though the life insurance company taxable income were the taxable income referred to in section 11.
**(b) Life insurance company taxable income** For purposes of this part, the term “life insurance company taxable income” means—
(1) life insurance gross income, reduced by
(2) life insurance deductions.
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Federal law — U.S. Code and appendices · legal_authorities
**(a) General rule** Taxes computed as provided in section 11 shall be imposed for each taxable year on the taxable income of every insurance company other than a life insurance company.
**(b) Alternative tax for certain small companies**
(1) **In general** — In lieu of the tax otherwise applicable under subsection (a), there is hereby imposed for each taxable year on the income of every insurance company to which this subsection applies a tax computed by multiplying the taxable investment income of such company for such taxable year by the rates provided in section 11(b).
(2) **Companies to which this subsection applies**
(A) *In general* — This subsection shall apply to every insurance company other than life if—
(i) the net written premiums (or, if greater, direct written premiums) for the taxable year do not exceed $2,200,000,
(ii) such company meets the diversification requirements of subparagraph (B), and
(iii) such company elects the application of this subsection for such taxable year.
The election under clause (iii) shall apply to the taxable year for which made and for all subsequent taxable years for which the requirements of clauses (i) and (ii) are met. Such an election, once made, may be revoked only with the consent of the Secretary.
(B) *Diversification requirements*
(i) *In general* — An insurance company meets the requirements of this subparagraph if—
(I) no more than 20 percent of the net written premiums (or, if greater, direct written premiums) of such company for the taxable year is attributable to any one policyholder, or
(II) such insurance company does not meet the requirement of subclause (I) and no person who holds (directly or indirectly) an interest in such insurance company is a specified holde
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Federal law — U.S. Code and appendices · legal_authorities
**(a) General rule** In the case of the acquisition of assets of a corporation by another corporation—
(1) in a distribution to such other corporation to which section 332 (relating to liquidations of subsidiaries) applies; or
(2) in a transfer to which section 361 (relating to nonrecognition of gain or loss to corporations) applies, but only if the transfer is in connection with a reorganization described in subparagraph (A), (C), (D), (F), or (G) of section 368(a)(1),
the acquiring corporation shall succeed to and take into account, as of the close of the day of distribution or transfer, the items described in subsection (c) of the distributor or transferor corporation, subject to the conditions and limitations specified in subsections (b) and (c). For purposes of the preceding sentence, a reorganization shall be treated as meeting the requirements of subparagraph (D) or (G) of section 368(a)(1) only if the requirements of subparagraphs (A) and (B) of section 354(b)(1) are met.
**(b) Operating rules** Except in the case of an acquisition in connection with a reorganization described in subparagraph (F) of section 368(a)(1)—
(1) The taxable year of the distributor or transferor corporation shall end on the date of distribution or transfer.
(2) For purposes of this section, the date of distribution or transfer shall be the day on which the distribution or transfer is completed; except that, under regulations prescribed by the Secretary, the date when substantially all of the property has been distributed or transferred may be used if the distributor or transferor corporation ceases all operations, other than liquidating activities, after such date.
(3) The corporation acquiring property in a distribution or transfer described in subsection (a) shall not be entitle
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Federal law — U.S. Code and appendices · legal_authorities
**(a) General rule** For purposes of this subtitle, the term “dividend” means any distribution of property made by a corporation to its shareholders—
(1) out of its earnings and profits accumulated after February 28, 1913, or
(2) out of its earnings and profits of the taxable year (computed as of the close of the taxable year without diminution by reason of any distributions made during the taxable year), without regard to the amount of the earnings and profits at the time the distribution was made.
Except as otherwise provided in this subtitle, every distribution is made out of earnings and profits to the extent thereof, and from the most recently accumulated earnings and profits. To the extent that any distribution is, under any provision of this subchapter, treated as a distribution of property to which section 301 applies, such distribution shall be treated as a distribution of property for purposes of this subsection.
**(b) Special rules**
(1) **Certain insurance company dividends** — The definition in subsection (a) shall not apply to the term “dividend” as used in subchapter L in any case where the reference is to dividends of insurance companies paid to policyholders as such.
(2) **Distributions by personal holding companies**
(A) In the case of a corporation which—
(i) under the law applicable to the taxable year in which the distribution is made, is a personal holding company (as defined in section 542), or
(ii) for the taxable year in respect of which the distribution is made under section 563(b) (relating to dividends paid after the close of the taxable year), or section 547 (relating to deficiency dividends), or the corresponding provisions of prior law, is a personal holding company under the law applicable to such taxable year,
the t
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Federal law — U.S. Code and appendices · legal_authorities
Income derived by a foreign central bank of issue from obligations of the United States or of any agency or instrumentality thereof (including beneficial interests, participations, and other instruments issued under section 302(c) of the Federal National Mortgage Association Charter Act ([12 U.S.C. 1717](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section1717&num=0&edition=prelim))) which are owned by such foreign central bank of issue, or derived from interest on deposits with persons carrying on the banking business, shall not be included in gross income and shall be exempt from taxation under this subtitle unless such obligations or deposits are held for, or used in connection with, the conduct of commercial banking functions or other commercial activities. For purposes of the preceding sentence the Bank for International Settlements shall be treated as a foreign central bank of issue.
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Federal law — U.S. Code and appendices · legal_authorities
Page 2092
TITLE 26—INTERNAL REVENUE CODE
§ 891
Editorial Notes
AMENDMENTS
1989—Subsec. (b)(1). Pub. L. 101–239, § 7811(i)(8)(B), sub-
stituted ‘‘paragraphs (2) and (3)’’ for ‘‘paragraph (2)’’.
Subsec. (b)(3). Pub. L. 101–239, § 7811(i)(8)(A), added
par. (3). Former par. (3) redesignated (4).
Subsec. (b)(4). Pub. L. 101–239, § 7811(i)(8)(A), (9), redes-
ignated former par. (3) as (4) and substituted ‘‘United
States source gross transportation income’’ for ‘‘trans-
portation income’’ in introductory provisions and in
subpar. (A).
1988—Subsec. (b)(1). Pub. L. 100–647 substituted
‘‘under section 863(c)(2)’’ for ‘‘under section 863(c)’’ and
inserted at end ‘‘To the extent provided in regulations,
such term does not include any income of a kind to
which an exemption under paragraph (1) or (2) of sec-
tion 883(a) would not apply.’’
Statutory Notes and Related Subsidiaries
EFFECTIVE DATE OF 1989 AMENDMENT
Amendment by Pub. L. 101–239 effective, except as
otherwise provided, as if included in the provision of
the Technical and Miscellaneous Revenue Act of 1988,
Pub. L. 100–647, to which such amendment relates, see
section 7817 of Pub. L. 101–239, set out as a note under
section 1 of this title.
EFFECTIVE DATE OF 1988 AMENDMENT
Amendment by Pub. L. 100–647 effective, except as
otherwise provided, as if included in the provision of
the Tax Reform Act of 1986, Pub. L. 99–514, to which
such amendment relates, see section 1019(a) of Pub. L.
100–647, set out as a note under section 1 of this title.
EFFECTIVE DATE
Section applicable to taxable years beginning after
Dec. 31, 1986, see section 1212(f) of Pub. L. 99–514, set out
as an Effective Date of 1986 Amendment note under sec-
tion 863 of this title.
APPLICABILITY
OF CERTAIN AMENDMENTS
BY PUB. L.
99–51
Source: Supplied 2024 U.S. Code historical extraction · 26 U.S.C. § 891
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