Reporting requirements

(a) In general (1) Return requirement (A) In general Subpart B of part III of subchapter A of chapter 61 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section: 6050BB. Returns relating to applicable private placement contracts (a) Initial report (1) In general Every reporting issuer, shall, not later than the applicable date, make a return (in such form as the Secretary may prescribe) with respect to each applicable private placement contract issued or reinsured by the issuer. (2) Information included Such return shall set forth— (A) the name, address, and TIN of the reporting issuer, (B) the name, address, and TIN of the holder of the contract, (C) the applicable adjusted basis (as defined in section 7702C(d)(2)) in the contract of such holder (determined as if an applicable distribution were to be made as of the applicable date), (D) any other contracts which are supported by the segregated asset account supporting such contract, (E) the name, address, and TIN of the holder of any contract described in subparagraph (D) who is related (within the meaning of section 7702C(c)(2)(B)) to the holder of such contract, and (F) such other information as the Secretary may require. (3) Applicable date For purposes of this section, the applicable date means, with respect to any applicable private placement contract, 30 days after the later of— (A) the date that is 180 days after the date of the enactment of this section, or (B) the date the contract first became an applicable private placement contract. (b) Annual reports (1) In general Every reporting issuer shall file an annual return with respect to each applicable private placement contract issued or reinsured by the issuer. (2) Time for filing return The return under paragraph (1) shall be filed at such time and in such manner as the Secretary shall prescribe. (3) Information included A return filed under paragraph (1) shall set forth— (A) the name, address, and TIN of the reporting issuer, (B) the name address, and TIN of the holder of the applicable private placement contract, (C) the name, address, and TIN of each person receiving an applicable distribution (as defined in section 7792C(d)(2)) under the contract if such person is not the holder of the contract, (D) the amounts for the taxable year of— (i) items of income, loss, deduction, and credit for the year with respect to the assets of which the holder is treated as the owner by reason of section 7702C(d)(1), (ii) the amount of any applicable distribution (as so defined) under the applicable private placement contract and the portion of such distribution which is treated as an excess distribution (as defined in section 7702C(d)(2)), (iii) the holder’s applicable adjusted basis (as defined in section 7702C(d)(2)) in the contract as of the date of each applicable distribution made during the reporting period and as of the last day of the reporting period (determined as if an applicable distribution were to be made on such day), and (iv) in the case of a reporting issuer described in subsection (d)(1)(B), premiums or other amounts paid or received by any person pursuant to any reinsurance or risk-shifting arrangement described in such subsection, and (E) such other information as the Secretary may require. (c) Statement To be furnished to taxpayers with respect to whom information is required (1) In general Every person that is required to make a return under subsection (a) or (b) shall furnish to each person whose identity is required to be set forth under subsection (a)(2)(B) or subparagraph (B) or (C) of subsection (b)(3) a written statement showing— (A) the name, address, and phone number of the information contact of the person required to make such return, and (B) the information required to be shown on such return with respect to the person to whom such statement is required to be furnished. (2) Furnishing of information The written statement required under paragraph (1) with respect to any return shall be furnished to the person on or before January 31 of the year following the calendar year for which the return is required to be made. (d) Definitions For purposes of this section— (1) Reporting issuer The term reporting issuer means any person who— (A) issues a life insurance contract or annuity contract which is treated as an applicable private placement contract, or (B) reinsures, or shifts risks with respect to any portion of, an applicable private placement contract. (2) Applicable private placement contract The term applicable private placement contract has the meaning given such term under section 7702C.. (2) Penalties (A) Failure to provide initial return Part I of subchapter B of chapter 68 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section: 6720D. Penalty for failure to report applicable private placement contracts (a) Imposition of penalty (1) In general Any person required to make a return under section 6050BB(a) who fails to file such return with the Secretary before the applicable date shall pay a penalty equal to the amount determined under paragraph (2). (2) Amount of penalty (A) In general The amount of the penalty determined under this paragraph is the sum of— (i) $1,000,000, plus (ii) an additional $1,000,000 for each penalty period ending before the date on which the failure described in subsection (a) has been corrected. (B) Penalty period For purposes of this subsection, the term penalty period means each period of 30 days beginning after the first 30-day period beginning with the applicable date. (3) Applicable date For purposes of this subsection, the term applicable date has the meaning given such term under section 6050BB(a)(3). (b) Special rules (1) Persons subject to insurance regulation In the case of a person— (A) which is regulated by an agency or entity under foreign, State, or local law, and (B) which is required to pay a penalty under this section, the requirement to pay such penalty shall be disclosed to such agency or entity. Failure to make a disclosure in accordance with the preceding sentence shall be treated as a failure to which this section applies. (2) Persons subject to Securities Exchange Act of 1932 In the case of a person— (A) which is required to file periodic reports under section 13 or 15(d) of the Securities Exchange Act of 1934 or is required to be consolidated with another person for purposes of such reports, and (B) which is required to pay a penalty under this section, the requirement to pay such penalty shall be disclosed in such reports filed by such person for such periods as the Secretary shall specify. Failure to make a disclosure in accordance with the preceding sentence shall be treated as a failure to which this section applies.. (B) Failure to make annual returns or payee statements (i) Returns Section 6724(d)(1)(B) of the Internal Revenue Code of 1986 is amended by striking or at the end of clause (xxviii), by inserting or at the end of clause (xxix), and by inserting after clause (xxix) the following new clause: (xxx) section 6050BB(b),. (ii) Statements Section 6724(d)(2) of such Code is amended— (I) by redesignating subparagraphs (NN) and (OO) as subparagraphs (OO) and (PP), respectively, and (II) by inserting after subparagraph (MM) the following new subparagraph: (NN) section 6050BB(c).. (3) Clerical amendments (A) The table of sections for subpart B of part III of subchapter A of chapter 61 of the Internal Revenue Code of 1986 is amended by inserting after the item relating to section 6050AA the following new item: Sec. 6050BB. Returns relating to applicable private placement contracts.. (B) The table of sections for part I of subchapter B of chapter 68 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item: Sec. 6720D. Penalty for failure to report applicable private placement contracts.. (b) Rules relating to foreign account tax compliance (1) Insurance companies treated as financial institutions (A) In general Section 1471(d)(5) of the Internal Revenue Code of 1986 is amended by striking or at the end of subparagraph (B), by striking the period at the end of subparagraph (C) and inserting, or, and by adding at the end the following new subparagraph: (D) except as otherwise provided by the Secretary, holds itself out as a life insurance company.. (B) Treatment of certain corporations as foreign financial institutions Section 1471(d)(4) of such Code is amended by inserting (determined without regard to any election made under section 953(d)) after foreign entity. (C) Limitation on authority to exclude Section 1471(f)(4) of such Code is amended by inserting (other than an entity described in subsection (d)(5)(D)) before the period at the end. (2) Private placement contracts treated as financial accounts Section 1471(d)(2) of the Internal Revenue Code of 1986 is amended by striking and at the end of subparagraph (B), by striking the period at the end of subparagraph (C) and inserting, and, and by inserting after subparagraph (C) the following new subparagraph: (D) any contract which is described in section 7702C(b)(3) and any separate segregated asset account that holds assets supporting such a contract.. (3) Additional limitation on exceptions Section 1472(c)(2) of the of the Internal Revenue Code of 1986 is amended by inserting (other than payments to an entity described in section 1471(d)(5)(D)) before the period at the end. (4) Effective date The amendments made by this subsection shall apply to payments made after the date that is 1 year after the date of the enactment of this Act.