§4372 — Title 26 Internal Revenue Code | U.S. Code

Summary

These definitions control who owes the federal excise tax on insurance bought from foreign insurers. A "foreign insurer or reinsurer" is a nonresident alien, foreign partnership, or foreign corporation, but not a foreign government or a taxing municipal body. A casualty policy or indemnity bond is taxed when the insured is a U.S. company, partnership, or resident covered for risks wholly or partly in the United States, or a foreign person doing business in the United States covered for U.S. risks. Life, sickness, accident, and annuity contracts are covered when they insure the life or person of a U.S. citizen or resident. Reinsurance of any of these taxable contracts is also covered.

Title 26, §4372

Internal Revenue Code — Source: USLM XML via OLRC

(a)For purposes of section 4371, the term “foreign insurer or reinsurer” means an insurer or reinsurer who is a nonresident alien individual, or a foreign partnership, or a foreign corporation. The term includes a nonresident alien individual, foreign partnership, or foreign corporation which shall become bound by an obligation of the nature of an indemnity bond. The term does not include a foreign government, or municipal or other corporation exercising the taxing power.

(b)For purposes of section 4371(1), the term “policy of casualty insurance” means any policy (other than life) or other instrument by whatever name called whereby a contract of insurance is made, continued, or renewed.

(c)For purposes of this chapter, the term “indemnity bond” means any instrument by whatever name called whereby an obligation of the nature of an indemnity, fidelity, or surety bond is made, continued, or renewed. The term includes any bond for indemnifying any person who shall have become bound or engaged as surety, and any bond for the due execution or performance of any contract, obligation, or requirement, or the duties of any office or position, and to account for money received by virtue thereof, where a premium is charged for the execution of such bond.

(d)For purposes of section 4371(1), the term “insured” means—

(1)a domestic corporation or partnership, or an individual resident of the United States, against, or with respect to, hazards, risks, losses, or liabilities wholly or partly within the United States, or

(2)a foreign corporation, foreign partnership, or nonresident individual, engaged in a trade or business within the United States, against, or with respect to, hazards, risks, losses, or liabilities within the United States.

(e)For the purpose of section 4371(2), the term “policy of life, sickness, or accident insurance, or annuity contract” means any policy or other instrument by whatever name called whereby a contract of insurance or an annuity contract is made, continued, or renewed with respect to the life or hazards to the person of a citizen or resident of the United States.

(f)For the purpose of section 4371(3), the term “policy of reinsurance” means any policy or other instrument by whatever name called whereby a contract of reinsurance is made, continued, or renewed against, or with respect to, any of the hazards, risks, losses, or liabilities covered by contracts taxable under paragraph (1) or (2) of section 4371.

Notes & Related Subsidiaries

Editorial Notes

Amendments

1976—Subsec. (a). Pub. L. 94–455 substituted “section 4371” for “this subchapter”, and inserted provision that term does not include a foreign government, or municipal or other corporation exercising the taxing power. Subsec. (c). Pub. L. 94–455 substituted “this chapter” for “this subchapter”. 1958—Subsec. (d)(2). Pub. L. 85–859 substituted “against, or with respect to, hazards, risks, losses, or liabilities” for “with respect to hazards, risks, or liabilities”.

Statutory Notes and Related Subsidiaries

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 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.

§4372 Definitions

Summary

Title 26, §4372

Notes & Related Subsidiaries

Editorial Notes

Amendments

Statutory Notes and Related Subsidiaries

Effective Date

Effective Date

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