Treasury Regulations (26 C.F.R.)
26 CFR § 1.817A-1
Certain modified guaranteed contracts.
# (a)
Definitions—(1) Modified guaranteed contract. The term modified guaranteed contract (MGC) is defined in section 817A(d) as an annuity, life insurance, or pension plan contract (other than a variable contract described in section 817) under which all or parts of the amounts received under the contract are allocated to a segregated account. Assets and reserves in this segregated account must be valued from time to time with reference to market values for annual statement purposes. Further, an MGC must provide either for a net surrender value or for a policyholder's fund (as defined in section 807(e)(1)). If only a portion of a contract is not described in section 817, such portion is treated as a separate contract for purposes of applying section 817A.
(2) Temporary guarantee period. An MGC may temporarily guarantee a return other than the permanently guaranteed crediting rate for a period specified in the contract (the temporary guarantee period). During the temporary guarantee period, the amount paid to the policyholder upon surrender is usually increased or decreased by a market value adjustment, which is determined by a formula set forth under the terms of the MGC.
(3) Equity-indexed modified guaranteed contract. An equity-indexed MGC is an MGC, as defined in paragraph (a)(1) of this section, that provides a return during or at the end of the temporary guarantee period based on the performance of stocks, other equity instruments, or equity-based derivatives.
(4) Non-equity-indexed modified guaranteed contract. A non-equity-indexed MGC is an MGC, as defined in paragraph (a)(1) of this section, that provides a return during or at the end of the temporary guarantee period not based on the performance of stocks, other equity instruments, or equity-based derivatives.
# (b) Waiver of section 811(d) for certain non-equity-indexed modified guaranteed contracts.
Section 811(d) is waived during the temporary guarantee period when applied to non-equity-indexed MGCs.
# (c) Applicability dates.
Paragraph (b) of this section applies to taxable years beginning after October 13, 2020. However, a taxpayer may choose to apply the rules of paragraph (b) of this section for a taxable year beginning after December 31, 2017, the effective date of the revision of section 807 by Public Law 115-97, and on or before October 13, 2020, provided the taxpayer consistently applies the rules of paragraph (b) of this section to that taxable year and all subsequent taxable years. See section 7805(b)(7). For taxable years beginning on or before October 13, 2020, see paragraph (b) of this section as contained in 26 CFR part 1 revised as of April 1, 2020.
[T.D. 9058, 68 FR 24350, May 7, 2003, as amended by T.D. 9911, 85 FR 64394, Oct. 13, 2020]
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In this part (40 sections)
- 1.812-3 · Computation of loss from operations.
- 1.812-4 · Operations loss carrybacks and operations loss carryovers.
- 1.812-5 · Offset.
- 1.812-6 · New company defined.
- 1.812-7 · Application of subtitle A and subtitle F.
- 1.812-8 · Illustration of operations loss carrybacks and carryovers.
- 1.812-9 · Cross-reference.
- 1.815-1 · Taxable years affected.
- 1.815-2 · Distributions to shareholders.
- 1.815-3 · Shareholders surplus account.
- 1.815-4 · Policyholders surplus account.
- 1.815-5 · Other accounts defined.
- 1.815-6 · Special rules.
- 1.816-1 · Life insurance reserves.
- 1.817-1 · Taxable years affected.
- 1.817-2 · Treatment of capital gains and losses.
- 1.817-3 · Gain on property held on December 31, 1958, and certain…
- 1.817-4 · Special rules.
- 1.817-5 · Diversification requirements for variable annuity, endowment,…
- 1.817A-0 · Table of contents.
- 1.817A-1 · Certain modified guaranteed contracts.
- 1.818-1 · Taxable years affected.
- 1.818-2 · Accounting provisions.
- 1.818-3 · Amortization of premium and accrual of discount.
- 1.818-4 · [Reserved]
- 1.818-5 · Short taxable years.
- 1.818-6 · Transitional rule for change in method of accounting.
- 1.818-7 · Denial of double deductions.
- 1.818-8 · Special rules relating to consolidated returns and certain…
- 1.819-1 · Taxable years affected.
- 1.819-2 · Foreign life insurance companies.
- 1.822-1 - 1.822-2 · §§ 1.822-1-1.822-2 [Reserved]
- 1.822-3 · Amortization of premium and accrual of discount.
- 1.822-4 · Taxable years affected.
- 1.822-5 · Mutual insurance company taxable income.
- 1.822-6 · Real estate owned and occupied.
- 1.822-7 · Amortization of premium and accrual of discount.
- 1.822-8 · Determination of taxable investment income.
- 1.822-9 · Real estate owned and occupied.
- 1.822-10 · Amortization of premium and accrual of discount.