Title 26, Internal Revenue CodeRelease 119-110
§4371 Imposition of Tax
Title 26 › Subtitle D — Miscellaneous Excise Taxes › CHAPTER 34 — TAXES ON CERTAIN INSURANCE POLICIES › Subchapter A — Policies Issued By Foreign Insurers › § 4371
Summary
A tax must be paid on every insurance policy, indemnity bond, annuity contract, or reinsurance issued by a foreign insurer or reinsurer. Casualty insurance and indemnity bonds are taxed at 4 cents per dollar (or part of a dollar) of the premium when issued to an insured (see section 4372(d) for who that is). Life, sickness, and accident policies and annuity contracts are taxed at 1 cent per dollar (or part), and reinsurance that covers any of those contracts is also taxed at 1 cent per dollar (or part).
Full Legal Text
Title 26, §4371
Internal Revenue Code, Source: USLM XML via OLRC
There is hereby imposed, on each policy of insurance, indemnity bond, annuity contract, or policy of reinsurance issued by any foreign insurer or reinsurer, a tax at the following rates:
(1)Casualty insurance and indemnity bonds
4 cents on each dollar, or fractional part thereof, of the premium paid on the policy of casualty insurance or the indemnity bond, if issued to or for, or in the name of, an insured as defined in section 4372(d);
(2)Life insurance, sickness, and accident policies, and annuity contracts
1 cent on each dollar, or fractional part thereof, of the premium paid on the policy of life, sickness, or accident insurance, or annuity contract; and
(3)Reinsurance
1 cent on each dollar, or fractional part thereof, of the premium paid on the policy of reinsurance covering any of the contracts taxable under paragraph (1) or (2).
Legislative History
Notes & Related Subsidiaries
Editorial Notes
Amendments
1989—Par. (2). Pub. L. 101–239 struck out “, unless the insurer is subject to tax under section 842(b)” after “or annuity contract”. 1987—Par. (2). Pub. L. 100–203 substituted “section 842(b)” for “section 813”. 1984—Par. (2). Pub. L. 98–369 substituted “section 813” for “section 819”. 1976—Pub. L. 94–455 substituted in par. (1) “4 cents” for “four cents” and “premium paid” for “premium charged”, in pars. (2) and (3) “1 cent” for “one cent” and “premium paid” for “premium charged”, and struck out provision following par. (3) relating to computation of tax on premium paid in lieu of premium charged. 1965—Pub. L. 89–44 inserted last sentence relating to computation of tax on premium paid in lieu of premium charged. 1959—Par. (2). Pub. L. 86–69 substituted “section 819” for “section 816”. 1958—Pub. L. 85–859 substituted “is hereby imposed, on each policy of insurance, indemnity bond, annuity contract, or policy of reinsurance issued by any foreign insurer or reinsurer, a tax” for “shall be imposed a tax on each policy of insurance, indemnity bond, annuity contract, or policy of reinsurance issued by any foreign insurer or reinsurer”. 1956—Par. (2). Act Mar. 13, 1956, substituted “section 816” for “section 807”.
Statutory Notes and Related Subsidiaries
Effective Date
of 1989 AmendmentAmendment 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 1987 AmendmentAmendment by Pub. L. 100–203 applicable to taxable years beginning after Dec. 31, 1987, see section 10242(d) of Pub. L. 100–203, set out as a note under section 816 of this title.
Effective Date
of 1984 AmendmentAmendment by Pub. L. 98–369 applicable to taxable years beginning after Dec. 31, 1983, see section 215 of Pub. L. 98–369, set out as an
Effective Date
note under section 801 of this title.
Effective Date
of 1976 AmendmentAmendment by Pub. L. 94–455 effective on first day of first month which begins more than 90 days after Oct. 4, 1976, see section 1904(d) of Pub. L. 94–455, set out as a note under section 4041 of this title.
Effective Date
of 1965 AmendmentAmendment by Pub. L. 89–44 applicable with respect to policies, bonds, and contracts with respect to which the tax imposed by this section is required to be paid on the basis of a return, see section 804(c) of Pub. L. 89–44, set out as a note under section 4374 of this title.
Effective Date
of 1959 AmendmentAmendment by Pub. L. 86–69 applicable only with respect to taxable years beginning after Dec. 31, 1957, see section 4 of Pub. L. 86–69, set out as an
Effective Date
note under section 381 of this title.
Effective Date
of 1958 AmendmentAmendment by Pub. L. 85–859 effective on first day of first calendar quarter which begins more than 60 days after Sept. 2, 1958, see section 1(c) of Pub. L. 85–859, Sept. 2, 1958, 72 Stat. 1275.
Effective Date
of 1956 AmendmentAmendment by act Mar. 13, 1956, applicable only to taxable years beginning after Dec. 31, 1954, see section 6 of act Mar. 13, 1956, set out as a note under section 316 of this title.
Reference
Citations & Metadata
Citation
26 U.S.C. § 4371
Title 26, Internal Revenue Code
Last Updated
Sep 22, 2026
Release point: 119-110