Atlantic Mutual Insurance Company, and Includible Subsidiaries v. Commissioner of Internal Revenue

OPINION OF THE COURT

MANSMANN, Circuit Judge.

In this appeal, we address the “fresh start” provision of section 1023(e)(3) of the Tax Reform Act of 1986. There Congress permitted property & casualty insurers a onetime forgiveness of income resulting from the change in computing “losses incurred dedue-tions” from undiscounted to a discounted basis as mandated by newly enacted section 846 of the Internal Revenue Code. Specifically, the Commissioner challenges the decision of the Tax Court which invalidated Treas.Reg. § 1.846-3(c) to the extent that it defines all additions to a property &…