[Code of Federal Regulations]
[Title 26, Volume 8]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.831-1]

[Page 733]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
Determination of Tax Liability--Table of Contents
 
Sec. 1.831-1  Tax on insurance companies (other than life or mutual), 

mutual marine insurance companies, and mutual fire insurance companies 
issuing perpetual policies.

    (a) All insurance companies, other than life or mutual or foreign 
insurance companies not carrying on an insurance business within the 
United States, and all mutual marine insurance companies and mutual fire 
insurance companies exclusively issuing either perpetual policies, or 
policies for which the sole premium charged is a single deposit which, 
except for such deduction of underwriting costs as may be provided, is 
refundable upon cancellation or expiration of the policy, are subject to 
the tax imposed by section 831. As used in this section and Sec. Sec. 
1.832-1 and 1.832-2, the term ``insurance companies'' means only those 
companies which qualify as insurance companies under the definition 
provided by paragraph (b) of Sec. 1.801-1 and which are subject to the 
tax imposed by section 831.
    (b) All provisions of the Code and of the regulations in this part 
not inconsistent with the specific provisions of section 831 are 
applicable to the assessment and collection of the tax imposed by 
section 831(a), and insurance companies are subject to the same 
penalties as are provided in the case of returns and payment of income 
tax by other corporations.
    (c) Since section 832 provides that the underwriting and investment 
exhibit of the annual statement approved by the National Convention of 
Insurance Commissioners shall be the basis for computing gross income 
and since the annual statement is rendered on the calendar year basis, 
the returns under section 831 shall be made on the basis of the calendar 
year and shall be on Form 1120. Insurance companies are entitled, in 
computing insurance company taxable income, to the deductions provided 
in part VIII (section 241 and following), subchapter B, chapter 1 of the 
Code.
    (d) Foreign insurance companies not carrying on an insurance 
business within the United States are not taxable under section 831 but 
are taxable as other foreign corporations. See section 881.
    (e) Insurance companies are subject to both normal tax and surtax. 
The normal tax shall be computed as provided in section 11(b) and the 
surtax shall be computed as provided in section 11(c). For the 
circumstances under which the $25,000 exemption from surtax for certain 
taxable years may be disallowed in whole or in part, see section 1551. 
For alternative tax where the net long-term capital gain for any taxable 
year exceeds the net short-term capital loss, see section 1201(a) and 
the regulations thereunder.