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TITLE 26-INTERNAL REVENUE CODE (2) Amounts In the nature of interest All amounts in the nature of interest, whether or not guaranteed, for the taxable year on insurance or annuity contracts (in- cluding contracts supplementary thereto) which do not involve, at the time of accrual, life, health, or accident contingencies. (3) Discount on prepaid premiums All amounts accrued for the taxable year for discounts in the nature of interest, wheth- er or not guaranteed, on premiums or other consideration paid in advance on insurance or annuity contracts. (4) Interest on certain special contingency reserves Interest for the taxable year on special con- tingency reserves under contracts of group term life insurance or group health and acci- dent insurance which are established and maintained for the provision of insurance on retired lives, for premium stabilization, or for a combination thereof. (Added Pub. L. 86-69, § 2(a), June 25, 1959, 73 Stat. 118, and amended Pub. L. 87-792, §7(g), Oct. 10, 1962, 76 Stat. 829; Pub. L. 88-571, § 5(a), Sept. 2, 1964, 78 Stat. 860; Pub. L. 91-172, title IX, §907(a)(1), Dec. 30, 1969, 83 Stat. 715; Pub. L. 93-406, title II, §§ 1016(a)(6), 2002(g)(9), 2004(c)(3), Sept. 2, 1974, 88 Stat. 929, 970, 986; Pub. L. 94-267, § (1)(c)(4), Apr. 15, 1976, 90 Stat. 367; Pub. L. 94-455, title XIX, § 1901(a)(97), Oct. 4, 1976, 90 Stat, 1780.) REFERENCES IN TEXT Section 165 of the Internal Revenue Code of 1939, referred to in subsecs. (d)(1) and (2), was classified to section 165 of former Title 26, Internal Revenue Code. Section 101 of the Internal Revenue Code of 1939, re- ferred to in subsec. (d)(4), was classified to section 101 of former Title 26, Internal Revenue Code. Sections 101 and 165 were repealed by section 7851(a)(1)(A) of this title. For table of comparisons of the 1939 Code to the 1954 Code, see Table I preceding section 1 of this title. See, also, section 7851(e) of this title for provi- sion that references in the 1954 Code to a provision of the 1939 Code, not then applicable, shall be deemed a reference to the corresponding provision of the 1954 Code, which is then applicable. PRIOR PROVISIONS A prior section 805, acts Aug. 16, 1954, ch. 736, 68A Stat. 258; Mar. 13, 1956, ch. 83, § 2, 70 Stat. 43, autho- rized a special interest deduction pior to the general revision of this part by Pub. L. 86-69, § 2(a). AMENDMENTS 1976-Subsec. (b)(3)(B). Pub. L. 94-455, § 1901(a)(97)(A), substituted in subpar. catchline "Spe- cial rule" for "Special rules" and eliminated in text special rule relating to determination of the current earnings rate for any taxable year beginning before Jan. 1, 1958. Subsec. (b)(4)(B). Pub. L. 94-455, § 1901(a)(97)(B), struck out "(determined without regard to fair market value on December 31, 1958)" following "shall be the adjusted basis". Subsec. (d). Pub. L. 94-455, § 1901(a)(97)(C), among other changes, struck out provisions relating to a spe- cial transitional rule. Subsec. (d)(1)(C). Pub. L. 94-267 substituted "(19), and (20)" for "and (19)". 1974-Subsec. (d)(1)(C). Pub. L. 93-406, § 1016(a)(6) substituted "(8), (11), (12), (13), (14), and (15)" for "and (8)". Pub. L. 93-406 § 2004(c)(3), inserted references to section 401(a)(16) and (19). Subsec. (d)(1)(E). Pub. L. 93-406, § 2002(g)(9), added subsec. (d)(1)(E). 1969-Subsec. (e)(4). Pub. L. 91-172 made express reference to interest on special contingency reserves under specific insurance contracts established and maintained for the provision of insurance on retired lives and premium stabilization. 1964-Subsee. (d)(1)(D). Pub. L. 88-571 inserted ", or purchased to provide retirement annuities for employ- ees described in section 403(b)(1)(A)(ii) by an employ- er which is a State, a political subdivision of a State, or an agency or instrumentality of dny one or more of the foregoing". 1962-Subsec. (d)(1). Pub. L. 87-792 substituted "de- scribed in section 403(a), or plans meeting" for "meet- ing the requirements of section 401(a)(3), (4), (5), and (6) or" in subpar. (B). and "(5), (6), (7), and (8)" for "(5), and (6)" in subpar. (C). EFFECTIVE DATE OF 1976 AMENDMENT Amendment of subsecs. (b)(3)(B), (4)(B), (d) by sec- tion 1901(a)(97)(A) to (C) of Pub. L. 94-455 effective for taxable years beginning after Dec. 31, 1976, see sec- tion 1901(d) of Pub. L. 94-455, set out as an Effective Date of 1976 Amendment note under section 2 of this title. Amendment by Pub. L. 94-267 applicable with re- spect to payments made to an employee, on or after July 4, 1974, see section l(e) of Pub. L. 94-267, set out as a note under section 401 of this title. EFFECTIVE DATE OF 1974 AMENDMENT Amendment by section 1016(a)(6) of Pub. L. 93-406 applicable, except as otherwise provided in section 1017(c) through (h) of Pub. L. 93-406, for plan years beginning after Sept. 2, 1974, but, in the case of plans in existence on Jan. 1, 1974, amendment by Pub. L. 93- 406 applicable for plan years beginning after Dec. 31, 1975, see section 1017 of Pub. L. 93-406, set out as an Effective Date, Transitional Rules note under section 410 of this title. Amendment by section 2002(g)(9) of Pub. L. 93-406 effective on Jan. 1, 1975, see section 2002(i)(2) of Pub. L. 93-406, set out as an Effective Date note under sec- tion 4973 of this title. Amendment by section 2004(c)(3) of Pub. L. 93-406 applicable to years beginning after Dec. 31, 1975, see section 2004(d) of Pub. L. 93-406, set out as an Effec- tive Date, Transition Provisions note under section 415 of this title. EFFECTIVE DATE OF 1969 AMENDMENT Section 907(d) of Pub. L. 91-172 provided that: "The amendments made by subsection (a) [amending this section and section 810(c) of this title] shall apply to taxable years beginning after December 31, 1957. The amendments made by subsection (b) (amending sec- tion 815 of this title] shall apply to taxable years be- ginning after December 31, 1968. The amendments made by subsection (c) [adding section 844 and amend- ing sections 809, 823. and 825 of this title] shall apply with respect to losses occurred in taxable years begin- ning after December 31, 1962, but shall not affect any tax liability for any taxable year beginning before January 1, 1967." EFFECTIVE DATE OF 1964 AMENDMENT Section 5(b) of Pub. L. 88-571 provided that: "The amendment made by subsection (a) [to this section] shall apply to taxable years beginning after December 31, 1963." EFFECTIVE DATE OF 1962 AMENDMENT Amendment by Pub. L. 87-792 applicable to taxable years beginning after Dec. 31, 1962, see section 8 of Pub. L. 87-792, set out as an Effective Date of 1962 Amendment note under section 37 of this title. § 805 Page 502