1120-L U.S. Life Insurance Company Income Tax return

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1120-L

Form
Department of the Treasury
Internal Revenue Service
Check if:

1

Consolidated return
(attach Form 851) .
Life-nonlife consolidated return . .
Schedule M-3
(Form 1120-L)
attached . . .

3

Tax and Payments

Deductions (See instructions for limitations on deductions.)

Income

E

For calendar year 2010 or tax year beginning
, 2010, ending
▶ See separate instructions.

(1)

Check if:

Please
print
or
type
Final return

OMB No. 1545-0128

2010

, 20

Name

A

2

U.S. Life Insurance Company Income Tax Return

B Employer identification number

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Number, street, and room or suite no. If a P.O. box, see instructions.

C Date incorporated

City or town, state, and ZIP code

D Check applicable box if an election
has been made under section(s):

(2)

(3)

Name change

(4)

Address change

953(c)(3)(C)

Amended return

1

Gross premiums, etc., less return premiums, etc. Enter balance .

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3
4

Net decrease, if any, in reserves (see instructions) . . . .
10% of any decrease in reserves under section 807(f)(1)(B)(ii) .
Investment income (Schedule B, line 8) (see instructions) . .

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5
6
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Net capital gain (Schedule D (Form 1120), line 13) . . . .
Income from a special loss discount account (attach Form 8816)
Other income (attach schedule)
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Life insurance company gross income. Add lines 1 through 7 .

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Death benefits, etc. . . . . . . . . . .
Net increase, if any, in reserves (Schedule F, line 35)

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10% of any increase in reserves under section 807(f)(1)(B)(i) . . . . .
Deductible policyholder dividends (Schedule F, line 18e) . . . . . .
Assumption by another person of liabilities under insurance, etc., contracts

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13

14
15a
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Dividends reimbursable by taxpayer . . . . . . . . . . .
Interest ▶
b Less tax-exempt interest expense
Deductible policy acquisition expenses (Schedule G, line 20) . . . .

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c Bal ▶
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15c
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17
18
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Additional deduction (attach Form 8816) . . . .
Other deductions (see instructions) (attach schedule)
Add lines 9 through 18 . . . . . . . . .

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19

20
21a

Subtotal. Subtract line 19 from line 8 . . . . . . . . . .
Dividends-received deduction (Schedule A, line 16, column (c)) . .
Plus: b Operations loss deduction (see instructions) (attach schedule)

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21a
21b

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22
23
24

Gain or (loss) from operations. Subtract line 21c from line 20 . . . . .
Small life insurance company deduction (Schedule H, line 17) . . . . .
Life insurance company taxable income (LICTI). Subtract line 23 from line 22

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24

25
26
27

Limitation on noninsurance losses (Schedule I, line 9) . . . . . . . . .
Amount subtracted from policyholders surplus account (Schedule J, Part II, line 10)

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Taxable income. Add lines 24, 25, and 26 (see instructions) .

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26
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28
29a
b

Total tax (Schedule K, line 10) . . . . . .
2009 overpayment credited to 2010 . . .
Prior year(s) special estimated tax payments to be applied

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Refundable credits from Form 3800, line 19c, and Form 8827, line 8c . .
29j
Estimated tax penalty. Check if Form 2220 is attached . . . . . . . . . . .
Amount owed. If line 29k is smaller than the total of lines 28 and 30, enter amount owed

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29k
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32
33

Overpayment. If line 29k is larger than the total of lines 28 and 30, enter amount overpaid
Enter amount from line 32: Credited to 2011 estimated tax ▶

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Refunded ▶

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29a
29b

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c
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2010 estimated tax payments

29c
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2010 special estimated tax payments (Do not include on line 29f)
Less 2010 refund applied for on Form 4466 .
29e (

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Tax deposited with Form 7004 . . . . . . . . . . .
Credits: (1) Form 2439
(2) Form 4136
U.S. income tax paid or withheld at source (attach Form 1042-S) .

21c

29d

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29g
29h
29i

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▶

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Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true,
correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.

Date

Signature of officer

Paid
Preparer
Use Only

Print/Type preparer’s name

Firm’s name

Preparer's signature

▲

▲

Sign
Here

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953(d)

May the IRS discuss this return
with the preparer shown below
Yes No
(see instructions)?

Title
Date

▶

PTIN

Firm's EIN ▶

Firm's address ▶

For Paperwork Reduction Act Notice, see separate instructions.

Check
if
self-employed
Phone no.

Cat. No. 11480E

Form 1120-L (2010)

Page 2

Form 1120-L (2010)

Schedule A

Dividend Income and Dividends-Received Deduction (see instructions)
Dividends subject to proration

(a) Dividends received

(c) Deduction
((a) times (b))

(b) %

1

Domestic corporations, less-than-20%-owned (other than debtfinanced stock)
. . . . . . . . . . . . . . .

1

70

2
3

Domestic corporations, 20%-or-more-owned (other than debtfinanced stock)
. . . . . . . . . . . . . . .
Debt-financed stock of domestic and foreign corporations . . .

2
3

see instructions

4
5
6

Public utility corporations, less-than-20%-owned . . . .
Public utility corporations, 20%-or-more-owned . . . . .
Foreign corporations, less-than-20%-owned, and certain FSCs

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4
5
6

7
8
9

Foreign corporations, 20%-or-more-owned, and certain FSCs

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80

42
48
70
80
100
100

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9

10
11
12

Gross dividends-received deduction. Add lines 1 through 9
Company share percentage (Schedule F, line 32)
. . .
Prorated amount. Line 10 times line 11
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12

13
14

Affiliated company dividends
Other corporate dividends .

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14

15

Total dividends. Add lines 1 through 14, column (a). Enter here
and on Schedule B, line 2 . . . . . . . . . . . .
Total deductions. Add lines 12 and 13, column (c). Reduce the
deduction as provided in section 805(a)(4)(D)(ii). Enter here and on
page 1, line 21a and on Schedule J, Part I, line 2c . . . . .

Wholly owned foreign subsidiaries (section 245(b)) and certain FSCs .

Certain affiliated company dividends

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Dividends not subject to proration

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Schedule B

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see instructions

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Gross Investment Income (section 812(d)) (see instructions)

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Interest (excluding tax-exempt interest) . . . . .
Gross taxable dividends (Schedule A, line 15, column (a))
Gross rents
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Gross royalties
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Leases, terminations, etc. . . . . . . . . . . . . . . . . . . . . . . .
Excess of net short-term capital gain over net long-term capital loss (Schedule D (Form 1120), line 12) .

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7
8
9

Gross income from trade or business other than an insurance business (attach schedule) .
Investment income. Add lines 1 through 7. Enter here and on page 1, line 4 . . . . .
Tax-exempt interest. Enter here and on Schedule F, line 13 and Schedule J, Part I, line 2d

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11

Increase in policy cash value of section 264(f) policies as defined in section 805(a)(4)(F). Enter here and
include on Schedule F, line 13 . . . . . . . . . . . . . . . . . . . . . . .
Add lines 8, 9, and 10
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11

12
13

100% qualifying dividends . . . . . . . . . . . . . . . . . . . . .
Gross investment income. Subtract line 12 from line 11. Enter here and on Schedule F, line 9 .

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13

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Form 1120-L (2010)

Form 1120-L (2010)

Schedule F

Page 3
Increase (Decrease) in Reserves (section 807) and Company/Policyholder Share Percentage
(section 812) (see instructions)
(a) Beginning of tax year

1

Life insurance reserves

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2
3
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Unearned premiums and unpaid losses . .
Supplementary contracts
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Dividend accumulations and other amounts .

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2
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4

5
6
7

Advance premiums . . .
Special contingency reserves
Add lines 1 through 6 . . .

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7

8
9

Increase (decrease) in reserves under section 807. Subtract line 7, column (a) from line 7, column (b)
Gross investment income (Schedule B, line 13)

10a

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b

Required interest on reserves under sections 807(c)(1), (3), (4), (5), and (6) (attach
schedule) . . . . . . . . . . . . . . . . . . . . .
Deductible excess interest. Enter here and on lines 18b and 19 below . . .

10a
10b

c
d
e

Deductible amounts credited to employee pension funds
Deductible amounts credited to deferred annuities . .
Deductible interest on amounts left on deposit . . .

10c
10d
10e

f
11

Total policy interest. Add lines 10a through 10e. Enter here and on line 26 below
Subtract line 10f from line 9 . . . . . . . . . . . . . . . .

12

Life insurance company gross income (see instructions)

13

Tax-exempt interest and the increase in policy cash value of section 264(f) policies as
defined in section 805(a)(4)(F). (Enter the sum of Schedule B, line 9 and line 10.) . .

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10f
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12

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14
15

Add lines 12 and 13 . . . . . . . . . . . . . . .
Increase in reserves from line 8. (If a decrease in reserves, enter -0-.) .

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15

16

Subtract line 15 from line 14 .

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17

Investment income ratio. Divide line 11 by line 16

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18a
b
c

Policyholder dividends paid or accrued
Excess interest from line 10b . . .
Premium adjustments
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18e

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18a
18b
18c

Experience-rated refunds
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18d
Deductible policyholder dividends. Add lines 18a through 18d. Enter here and on page 1, line 12

19
20
21

Deductible excess interest from line 10b . . .
Deductible dividends on employee pension funds
Deductible dividends on deferred annuities . .

22

Deductible premium and mortality charges for contracts paying excess interest

23

Add lines 19 through 22 .

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24
25
26

Subtract line 23 from line 18e . . . . . . .
Investment portion of dividends. Line 17 times line 24
Policy interest from line 10f . . . . . . . .

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24
25
26

27
28
29

Policyholder share amount. Add lines 25 and 26 .
Net investment income (see instructions) . . .
Policyholder share amount from line 27 . . .

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27
28
29

30
31
32
33

Company share of net investment income. Subtract line 29 from line 28 . . . . . . .
Total share percentage . . . . . . . . . . . . . . . . . . . . .
Company share percentage. Divide line 30 by line 28. Enter here and on Schedule A, line 11
Policyholders’ share percentage. Subtract line 32 from line 31 . . . . . . . . .

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31
32

34

Policyholders’ share of tax-exempt interest and the increase
defined in section 805(a)(4)(F). Multiply line 13 by line 33 .
Net increase (decrease) in reserves. Subtract line 34 from
line 10. If a (decrease), enter here and on page 1, line 2 . .

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(b) End of tax year

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20
21

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22

in policy cash value of section 264(f) policies as
. . . . . . . . . . . . . . .
line 8. If an increase, enter here and on page 1,
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33

100%
%
%

34
35
Form 1120-L (2010)

Page 4

Form 1120-L (2010)

Schedule G

Policy Acquisition Expenses (section 848) (see instructions)
(b) Group life
insurance

(a) Annuity
1

Gross premiums and other consideration .

2
3

Return premiums and premiums and other consideration incurred for
reinsurance
. . . . . . . . . . . . . . . . . .
Net premiums. Subtract line 2 from line 1 . . . . . . . . . .

2
3

4
5

Net premium percentage
Multiply line 3 by line 4 .

4
5

6
7

Combine line 5, columns (a), (b), and (c), and enter here. If zero or less, enter -0- on lines 7 and 8
Unused balance of negative capitalization amount from prior years . . . . . . . . .

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6
7

8
9
10

Combine lines 6 and 7. If zero or less, enter -0- .
General deductions (attach schedule) . . . .
Enter the lesser of line 8 or line 9 . . . . .

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8
9
10

11
12
13

Deductible general deductions. Subtract line 10 from line 9. Enter here and include on page 1, line 18 . . .
If the amount on line 6 is negative, enter it as a positive amount. If the amount on line 6 is positive, enter -0- .
Unamortized specified policy acquisition expenses from prior years . . . . . . . . . . . . .

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11
12
13

14

Deductible negative capitalization amount. Enter the lesser of line 12 or line 13 .

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14

15a

Tentative 60-month specified policy acquisition expenses. Enter amount from line 10, but not
more than $5 million . . . . . . . . . . . . . . . . . . . . . .

b
16

Limitation . . . . . . . . . . . . . . . . . . . .
Phase-out amount. Subtract line 15b from line 10. If zero or less, enter -0- .

17a

Current year 60-month specified policy acquisition expenses. Subtract line 16 from line 15a. If
zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . .

b
18a

b
19

20

Enter 10% of line 17a

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1.75%

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2.05%

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15a
15b
16

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7.7%

(

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$10,000,000

17a
.

Current year 120-month specified policy acquisition expenses. Subtract line 17a from
line 10 . . . . . . . . . . . . . . . . . . . . . . . . . .
Enter 5% of line 18a .

(c) Other

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17b

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18b

18a
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Enter the applicable amount of amortization from specified policy acquisition expenses capitalized in prior years
and deductible this year. Attach schedule . . . . . . . . . . . . . . . . . . . . . .

19

Deductible policy acquisition expenses. Add lines 14, 17b, 18b, and 19. Enter here and on page 1, line 16 .

20

.

Form 1120-L (2010)

Page 5

Form 1120-L (2010)

Schedule H

Small Life Insurance Company Deduction (section 806(a)) (see instructions)
Part I—Controlled Group Information
Tentative LICTI

Name of company

(a) Income

(b) (Loss)

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0
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1
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D /23
7
0

1
2
3
4
5
6

Add lines 1 through 5 in both columns .

7

Net controlled group tentative LICTI. Subtract line 6, column (b) from line 6, column (a).
Enter here and on line 11 below
. . . . . . . . . . . . . . . . .

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Part II—Small Life Insurance Company Deduction If total assets (Schedule L, Part I, line 6, column (b)), are $500
million or more, complete lines 8 through 12, line 16, and enter -0- on line 17 (see instructions).
8
9a
b
10a

Gain or (loss) from operations from page 1, line 22
Noninsurance income
. . . . . . . .
Noninsurance deductions . . . . . . .

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9a
9b

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Gain or (loss) on insurance operations. Subtract line 9a from line 8 and add
line 9b . . . . . . . . . . . . . . . . . . . . . .
Adjustments (attach schedule) . . . . . . . . . . . . . . .

10a
10b

c
11

Tentative LICTI. Combine lines 10a and 10b . .
Net controlled group tentative LICTI from line 7 .

10c
11

12
13

Combined tentative LICTI. Add line 10c and line 11. If $15 million or more, skip
12
lines 13 through 15 and enter -0- on line 17 below and on page 1, line 23 . .
Enter 60% of line 12, but not more than $1,800,000 . . . . . . . . . . .

14a

Maximum statutory amount .

b

b
c
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13

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14c
15

$3,000,000

14a

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Subtract line 14a from line 12. If zero or less, enter -0- . . . . . . . .
Enter 15% of line 14b, but not more than $1,800,000 . . . . . . . .
Tentative small life insurance company deduction. Subtract line 14c from line 13

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14b
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16

Taxpayer’s share. Divide line 10c by the total of line 6, column (a) and line 10c. If line 10c is zero or less, enter
-0- on this line . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

16

17

Small life insurance company deduction. Multiply line 15 by line 16. Enter here and on page 1, line 23, and
on Schedule J, Part I, line 2b
. . . . . . . . . . . . . . . . . . . . . . . .

17

1

Noninsurance income (attach schedule)

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2

Noninsurance deductions (attach schedule)

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Noninsurance operations loss deductions .

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4

Add lines 2 and 3 .

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4

5

Noninsurance loss. Subtract line 1 from line 4. If line 1 is greater than line 4, skip lines 5 through 8 and enter
-0- on line 9
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5

6

Enter 35% of line 5

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6

7

Enter 35% of the excess of LICTI (page 1, line 24) over any noninsurance loss included on page 1 .

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7

8

Enter the lesser of line 6 or line 7

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8

9

Limitation on noninsurance losses. Subtract line 8 from line 5. Enter here and on page 1, line 25 .

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9

Schedule I

Limitation on Noninsurance Losses (section 806(b)(3)(C)) (see instructions)

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Form 1120-L (2010)

Page 6

Form 1120-L (2010)

Schedule J

Part I—Shareholders Surplus Account (Stock Companies Only) (section 815(c)) (see instructions)

1a
b
c

Balance at the beginning of the tax year . . . . . . . . . . .
Transfers under pre-1984 sections 815(d)(1) and (4) for the preceding year .
Balance at the beginning of the tax year. Add lines 1a and 1b . . . . .

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1a
1b
1c

2a
b
c

LICTI. Add lines 24 and 25, page 1. If zero or less, enter -0- .
Small life insurance company deduction (Schedule H, line 17) .
Dividends-received deduction (Schedule A, line 16, column (c))

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2a
2b
2c

3

Tax-exempt interest (Schedule B, line 9) (see instructions) .
Add lines 1c through 2d . . . . . . . . . . .

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4
5
6
7

Tax liability without regard to section 815. Figure the tax on line 2a as if it were total taxable income
Subtract line 4 from line 3. If zero or less, enter -0- . . . . . . . . . . . . . . .
Direct or indirect distributions in the tax year but not more than line 5
. . . . . . . . .
Balance at the end of the tax year. Subtract line 6 from line 5 . . . . . . . . . . . .

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2d
3
4

8
9a

Balance at the beginning of the tax year . . . . . . . . . . .
Direct or indirect distributions in excess of the amount on line 5, Part I above

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Tax increase on line 9a . . . . . . . . . . . . . .
Subtractions from account under pre-1984 sections 815(d)(1) and (4) .
Tax increase on line 9c . . . . . . . . . . . . . .

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d

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5
6
7

Part II—Policyholders Surplus Account (Stock Companies Only) (section 815(d)) (see instructions)
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10
11

1
2

Check if the corporation is a member of a controlled group (attach Schedule O (Form 1120)) .
Income tax . . . . . . . . . . . . . . . . . . . . . . . . .

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▶

3
4
5a

Alternative minimum tax (attach Form 4626) .
Add lines 2 and 3 . . . . . . . . .
Foreign tax credit (attach Form 1118) . . .

b
c
d
e
10
11

e
6
7
8
9
10

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9a

9b
9c
9d

Subtraction from account under pre-1984 sections 815(d)(2) . . . . . .
9e
Add lines 9a through 9e, but not more than line 8. Enter here and on page 1, line 26 .
Balance at the end of the tax year. Subtract line 10 from line 8
. . . . . . .

Schedule K

b
c
d

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Tax Computation (see instructions)

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6
7

Foreign corporations—tax on income not effectively connected with U.S. business
. .
Other taxes. Check if from:
Form 4255
Form 8611
Other (attach schedule)
Total tax. Add lines 7 through 9. Enter here and on page 1, line 28 . . . . . . .

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Credit from Form 8834, line 29 . . . . . . .
General business credit (attach Form 3800) . . .
Credit for prior year minimum tax (attach Form 8827)

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Bond credits from Form 8912 . . .
Total credits. Add lines 5a through 5e
Subtract line 6 from line 4 . . . .

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5b
5c
5d

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5e
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Form 1120-L (2010)

Page 7

Form 1120-L (2010)

Schedule L

Part I—Total Assets (section 806(a)(3)(C)) (see instructions)
(a) Beginning of tax year

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1

Real property .

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1

2

Stocks .

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2

3

Proportionate share of partnership and trust assets .

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3

4

Other assets (attach schedule) .

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4

5

Total assets of controlled groups

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5

6

Total assets. Add lines 1 through 5

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6

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(b) End of tax year

Part II—Total Assets and Total Insurance Liabilities (section 842(b)(2)(B)(i)) (see instructions)

Line references below are to the “Assets” (lines 1 and 2) and “Liabilities, Surplus, and Other Funds” (lines 3 through 13) sections of the NAIC Annual
Statement.
(a) Beginning of tax year

1

Subtotals for assets (line 26)

2

Total assets (line 28) .

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1

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2

3

Reserve for life policies and contracts (line 1) .

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3

4

Reserve for accident and health policies (line 2) .

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4

5

Liability for deposit-type contracts (line 3) .

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5

6

Life policy and contract claims (line 4.1)

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6

7

Accident and health policy and contract claims (line 4.2)

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7

8

Policyholder’s dividend and coupon accumulations (line 5) .

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8

9

Premiums and annuity considerations received in advance less discount (line 8)

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9

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10

Surrender values on canceled policies (line 9.1) .

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10

11

Part of other amounts payable on reinsurance assumed (line 9.3) .

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11

12

Part of aggregate write-ins for liabilities (line 25). (Only include items or amounts
includible in “total insurance liabilities on U.S. business” as defined in section 842(b)(2)
(B)(i))
. . . . . . . . . . . . . . . . . . . . . . . .

12

13

Separate accounts statement (line 27) .

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13

14

Total insurance liabilities. Add lines 3 through 13 .

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14

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(b) End of tax year

Form 1120-L (2010)

Page 8

Form 1120-L (2010)

Schedule M
1
a
2
a

b
c
3

Other Information (see instructions)

Check method of accounting:
Accrual b
Other (specify)
Check if the corporation is a:

No

8

At any time during the year, did one foreign person
own, directly or indirectly, at least 25% of (a)
the total voting power of all classes of stock of
the corporation entitled to vote or (b) the total value of
all classes of stock of the corporation? . . . .
If “Yes,” enter: a Percentage owned ▶
and b Owner’s country ▶

f
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a
0
t
1
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0
a
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0

Legal reserve company—if checked
Kind of company:
Stock
(2)
Mutual
(1)
Principal business:
(1)
Life Insurance
Health and accident insurance
(2)

c

Fraternal or assessment association
Burial or other insurance company

Enter the percentage that the total of the
corporation’s life insurance reserves (section
816(b)) plus unearned premiums and unpaid losses
(whether or not ascertained) on noncancelable life,
health or accident policies not included in
life insurance reserves bears to the corporation’s
total reserves (section 816(c))
%.
Attach a schedule of the computation.

4

Does the corporation have any variable annuity
contracts outstanding? . . . . . . . .

5

At the end of the tax year, did the corporation own,
directly or indirectly, 50% or more of the voting
stock of a domestic corporation? (For rules of
attribution, see section 267(c).) . . . . . .

If “Yes,” attach a schedule showing (a) name and
employer identification number (EIN), (b) percentage
owned, and (c) taxable income or (loss) before NOL
and special deductions of such corporation for the
tax year ending with or within your tax year.
6

Yes

Has the corporation elected to use its own payout
pattern for discounting unpaid losses and unpaid loss
adjustment expenses? . . . . . . . . .

10

Does the corporation discount any of the loss
reserves shown on its annual statement? . . . .

11a

Enter the total unpaid losses
corporation’s annual statement:
(1) For the current year: $
(2) For the previous year: $

7

At the end of the tax year, did any
individual, partnership, corporation, estate, or trust
own, directly or indirectly, 50% or more of
the corporation’s voting stock? (For rules of
attribution, see section 267(c).) If “Yes,” complete a
and b below . . . . . . . . . . .

a

b

shown

on

the

Enter the total unpaid loss adjustment expenses
shown on the corporation’s annual statement:
(1) For the current year: $
(2) For the previous year:

$

If the corporation has an operations loss deduction
(OLD) for the tax year and is electing under section
810(b)(3) to forego the carryback period, check
here
. . . . . . . . . . . . ▶

12

If the corporation is filing a consolidated return, the
statement required by Regulations section 1.1502-21
(b)(3) must be attached or the election will not be
valid.

Is the corporation a subsidiary in an affiliated group
or a parent-subsidiary controlled group? . . .
If “Yes,” enter name and EIN of the parent
corporation. ▶

No

The corporation may have to file
Form 5472,
Information Return of a 25% Foreign-Owned U.S.
Corporation or a Foreign Corporation Engaged in a
U.S. Trade or Business. Enter number of Forms 5472
attached ▶

9

b

Yes

13

Enter the available OLD carryover from prior tax years.
(Do not reduce it by any deduction on page 1,
line 21b.) ▶ $

14a

Enter the corporation’s state of domicile ▶

b

Attach a schedule showing name and identifying
number. (Do not include any information already
entered in 6 above.)

Was the annual statement used to prepare the tax
return filed with the state of domicile? . . . . .
If “No,” complete c below.

c

Enter the state where the annual statement used to
prepare the tax return was filed ▶

Enter percentage owned ▶
15

Is the corporation required to file Schedule UTP (Form
1120), Uncertain Tax Position Statement (see
instructions)? . . . . . . . . . . . .
If "Yes," complete and attach Schedule UTP.
Form 1120-L (2010)