PAYMENTS TO BENEFICIARIES OF DECEASED EMPLOYEES.

SEC. 302. PAYMENTS TO BENEFICIARIES OF DECEASED EMPLOYEES. (a) Amendment of Section 22 (b) (1).—Section 22 (b) (1) (relating to exclusion of life insurance proceeds from gross income) is hereby amended to read as follows: “(1) Life insurance, etc.— Amounts received— “(A) under a life insurance contract, paid by reason of the death of the insured; or “(B) under a contract of an employer providing for the payment of such amounts to the beneficiaries of an employee, Slid by reason of the death of the employee; whether in a single sum or otherwise (but if such amounts are held by the insurer, or the employer, under an agreement to pay interest thereon, the interest payments shall be included in gross income). The aggregate of the amounts excludible under subparagraph (B) by all the beneficiaries of the employee under all such contracts of any one employer may not exceed $5,000.” (b) Effective Date.—The amendment made by this section shall be applicable with respect to taxable years beginning after December 31, 1950.