Posted: 5/25/2010
NAMIC Pushes for Tax Fix for Small Companies
Since the Tax Reform Act of 1986, Section 831(b) of the Internal Revenue Code has allowed property/casualty insurance companies with direct or net written annual premiums not exceeding $1.2 million to elect to be taxed on their net investment income. However, this election level has not been adjusted to reflect the last 24 years of inflation. If it were indexed in order to account for inflationary changes since 1986, the investment income election would be $2,028,000.